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South American countries gather to discuss reducing broad band costs

Thursday, August 5th 2010 - 21:10 UTC
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Augmenting connectivity the great challenge for the region Augmenting connectivity the great challenge for the region

The economic development of Latin America has pushed technology experts to seek out a stronger technological network to suit the region’s changing needs.

One of Chile’s largest Internet providers, Entel, experienced a growth of 88% in broadband Internet subscribers the first quarter of 2010. This growth is only one example of rising demand for broadband Internet connections as the region develops.

A retrospective look at the market tendency in Chile reveals the impending need for unilateral regional action to supply sufficient service for the growing demand. In 2002, there were 199,000 Internet connections in Chile. In 2006, the number of connections reached about 1 million. In a survey taken in December 2009, 1.7 million Internet subscribers in Chile were reported. But this is only considering wired broadband, as there are extra 920,401 subscribers using wireless broadband. As of 2009, Chile had 10.39% of the total Internet connections in the region, followed by Argentina with 10%.

For this reason CEPAL, the United Nations’ regional economic commission, has called on six South American countries to meet in Santiago on Aug. 18 and 19. Representatives from Argentina, Brazil, Chile, Ecuador, Peru and Uruguay plan to analyze 2009’s international Internet data usage records to project the demand in the years to come.

The steps for the region are to be determined once the demand is thoroughly projected for 2010 to 2016. Any changes will depend on a joint international effort in hope of particularly lowering the costs of international links. This is paramount to reducing the overall price of broadband service, as international link costs make up 35%or 40% of the final cost.

For now, only two companies offer the international link service, but this conference hopes to attract foreign investors to lay underwater cables to Latin America.

Another important point of discussion is the elimination of roaming charges for mobile broadband in border areas. Authorities argued that the companies that provide services on both sides of borders are often the same.

At the same time, the United States invested US$1.2 billion in doing the same — expanding high-speed Internet accessibility. The Americas are still far behind in the ranking for Internet connectivity. The United States is 18th with an average download speed of 4 megabits per second. The world leaders are South Korea with 14.6 megabits per second and Japan with 7.9 megabits per second.

By Ricardo Pommer - Santiago Times

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