20 Jul 2011Colombia Broadband Overview

Liberalisation in Colombia’s telecom sector began in 1991 and helped boost growth in the market. Local telephony grew at an average annual rate of around 10 per cent in the 1990s. Broadband Internet access has been available in Colombia since 1997 but with initial limited access. From 1997 to 2001, only the cities of Bogota and Bucaramanga had broadband Internet access through cable operator TV Cable S.A. and the University of The Andes, and in 2001 ADSL services were first launched.

From 1999 to 2002, telecommunications were adversely affected by the economic downturn. During this period Colombia’s telecom industry lost USD 2 billion despite a profit of USD 1 billion in local services. Cash strapped Empresa Nacional de Telecomunicaciones, the wholly state owned incumbent operator for 56 years, was liquidated in June 2003, and replaced with Colombia Telecom (CT). It was only in 2006, after the signing of the Free Trade Agreement (FTA) with the USA that competition between Colombian operators started to take place. In April 2006, the government sold off its controlling stake in CT to Telefónica SA. As of late 2007, Telefónica Colombia (formerly CT) expanded DSL operations to all major cities, and there are now three ADSL and WiMAX broadband providers in Colombia.

ADSL is the leading technology in Colombia, but cable broadband continues to grow both in subscriber numbers and in geographical coverage thanks to the popularity of triple play solutions. The major cities each have their own cable broadband provider which constitutes a monopoly in its respective city. The mobile broadband market in Colombia took off in 2009, but has suffered from erratic and sometimes extremely low speeds.

Colombia’s broadband penetration is slightly below average for Latin America but higher than would be expected given the country’s economic indicators. Helped along by a regulatory framework that encourages competition and by government efforts to reduce the digital divide, as seen in its 2010-2014 ICT plan dubbed “Vive Digital Colombia”, broadband is expanding strongly. A single Convergence Licence allows companies to offer fixed-line telephony, Internet access, broadband, and other value-added services. Colombia is also one of the few Latin American countries where dominant telecom operators are obliged to provide local loop unbundling and wholesale services.

2011 and 2012 should see some significant transformations in Colombia’s telecommunications market. Fixed line operators ETB and Emcali are seeking strategic partners and/or investors, and sister companies Telmex and Comcel are combining their fixed and mobile operations. Number portability will be implemented by H2 2011 and the government is also preparing to award additional spectrum for 3G and 4G services in 2011.