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Título : Prices and quality of broadband in Latin America: benchmarking and trends
Autor/a: Galperin, Hernán
Fecha de publicación : ago-2012
Editor: Universidad de San Andrés. Departamento de Derecho. Centro de Estudios en Tecnología y Sociedad
Relación : Documento de trabajo (Universidad de San Andrés. Centro de Estudios en Tecnología y Sociedad);12
Resumen : After several years of growing at rates close to 50%, the fixed broadband market in Latin America is beginning to show signs of slowdown, as a result of saturation levels in higher-income urban areas and low adoption among medium and low-income households. Expanding the boundaries of the fixed broadband market towards these households represents one of the main challenges for telecommunications policy in the region over the coming years. The results of this paper suggest that, in general, fixed broadband prices in Latin America remain above the thresholds that promote the widespread adoption of the service. In particular, a comparison with developed countries suggests that there is ample room for price reductions and improved service quality. The “typical” broadband plan in Latin America is 66% more expensive than in OECD member countries, while, on average, the price per Mbps of download speed in developed countries is seven times cheaper than in Latin America. In regards to the service quality offered in the region, the results show a significant improvement over the past two years. The average download speed of the “typical” plan in Latin America doubled from 2010 to 2012, from less than 2 Mbps to almost 4 Mbps. However, the quality of the “typical” plan in OECD member countries also doubled (from 10 Mbps to 20 Mbps) during the same period. As a result, the gap in terms of service quality that separates the two regions remained constant. On average, the quality of service promised in the “typical” broadband plan in the region is five times lower than that in developed countries. Evidence suggests that there are very diverse situations within Latin America’s broadband markets. While some markets have prices comparable to those in the OECD countries, in the less developed countries of the region prices are five to 35 times higher, depending on the price indicator considered. However, the trend indicates a steady decline in broadband prices, and a very significant decline in some of the less mature markets, which points to a moderate optimism regarding increased adoption in the medium term. In analyzing the relationship between broadband prices and income, the results indicate that, on average, a household in Latin America must make an effort seven times higher than an OECD household to pay for the “typical” broadband plan available in the respective markets. Bridging this affordability gap represents a major challenge for achieving high penetration of services in the region. Several countries in the region have recognized this challenge, undertaking infrastructure initiatives and regulatory changes to increase competition, and fostering the supply of basic connectivity plans. Finally, it is essential to review the tax burden on broadband services, which significantly impacts the prices analyzed in this paper. Different studies show that the contribution of broadband to economic and social welfare increases with the level of penetration. Faced with this evidence, current tax policies penalizing broadband adoption entail a reduction in future economic and social benefits for the inhabitants of the region.
Descripción : Fil: Galperin, Hernán. Universidad de San Andrés. Centro de Estudios en Tecnología y Sociedad; Argentina.
URI : http://hdl.handle.net/10908/15561
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