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Connectivity: progress, achievements and challenges in Peru

Written by  Guillermo Thornberry
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Guillermo Thornberry Issue: 2010
Article no.: 2
Topic: Connectivity: progress, achievements and challenges in Peru
Author: Guillermo Thornberry
Title: Chairman of the Board
Organisation: Organismo Supervisor de Inversión Privada en Telecomunicaciones (OSIPTEL)
PDF size: 159KB

About author

Guillermo Thornberry is the President of the Board of Directors of the Supervising Agency for Private Investment in Telecommunications (OSIPTEL, in Spanish). Mr Thornberry is also President of REGULATEL (Latin American Forum of Telecommunication Regulators) and the Vice President of the Permanent Consultative Committee I (PCC.I) of the Organization of American States (OAE).

Mr Thornberry’s service in other public sector positions includes: National Deputy Head of the National Registry of Identification and Civil Status (RENIEC); President of the Board of Directors of the Supervising Agency for Investment in Energy (OSINERG); and Advisor to the Minister of Economy and Finance of Peru. In the private sector, he has served as Director of Business Institutions, as Professor of Universidad del Pacífico and Universidad Católica del Perú, and Associate Attorney in different law firms. Mr Thornberry also served in the United States as Executive Vice President of Information for Investment Decisions I.I.D.; Senior Consultant of Nathan Associates Inc.; Consultant of the World Bank Economic Development Institute in the United States and Cairo, Egypt; Advisor to the Ministry of Finance and Planning in Kenya; and Regional Deputy Director for Latin America and the Caribbean of the International Development Research Centre (IDRC). He is the author of an extensive list of publications and research works.

Guillermo Thornberry holds a Master in Philosophy from the University of Cambridge, England, in Economic Development. He has pursued specialization courses and programmemes at Harvard University, Cambridge, Massachusetts and at the Center for Advanced National Studies (CAEN), Lima - Peru, among others.

 

Article abstract

Connectivity to accelerate national development is one of Peru’s main policy goals, and the participation of the private sector in a fair and competitive environment is essential. OSIPTEL’s (the Supervising Agency for Private Investment in Telecommunications) reliability, autonomy and technical specialization have been essential in promoting new technologies to further Peru’s socio-economic development. Policies that favour the use of new technologies and that promote and provide guarantees for private investment have boosted Peru’s mobile penetration to 90 per cent.

 

Full Article

Connectivity is one of the main policy goals of the Peruvian Government. Connectivity will accelerate Peru’s national integration and promote the articulation of the largest number of inhabitants in the process of modernity and sustainable development. To meet this goal, which refers not only to telecommunications, but to the entire infrastructure needed to connect a country with a very complex geography, we have the participation of the private sector and a priority for public investments in areas which do not attract investors.

In the case of telephony, the operating companies for all services belong to the private sector and carry out their activities based upon concessions granted by the Government. The sector has had very favourable results because Government policies favouring the market and free competition have created a new environment for the sector’s development.

The investments made, along with regulatory policies in the sectors of telecommunications, highways, electricity, ports and airports, have changed the face of Peru and have facilitated the development of the Peruvian economy in domestic and international markets. The country’s progress is reflected in the growing number of public service users and in the number of population centres that are now equipped with the facilities needed to stimulate production and employment.

Stable Governmental policies that promote and provide guarantees for private investment, along with ongoing regulatory adaptation to take advantage of such rapidly changing technologies as telecommunications, have been quite successful. Peru, with its population of nearly 29 million people, had close to 26 million cell phones at the end of March 2010. Thanks to Peru’s public policies, its goal of connecting a very high per centage of the population using modern technologies has been met. Today, over 80 per cent of the national territory is connected by mobile telephone services. The country’s goal of quickly integrating Peru’s rural and isolated areas, which until a few years ago had little - if any - telecommunications, is being met by promoting fixed wireless telephony.

Peru’s policies are implemented within an environment that fully respects the service concession grants, the applicable market laws and regulatory policies. Peru has also been successful in balancing the legitimate expectations of corporate profitability and the users’ rights to competitive rates and quality services.

Peru is now drafting a National Broadband Plan for subsequent approval. The idea is to create the infrastructure needed to foster an Information and Knowledge Society and prepare the country to take full advantage of the opportunities and advantages that technological innovation brings.

The market is changing rapidly in response to the growing use of smartphones, the availability of advanced services and increasingly attractive rates; connectivity in Peru is rapidly moving forward both quantitatively and qualitatively.

This entire process has demanded a great technical effort from the telecommunications regulatory agency. OSIPTEL’s recognised reliability, autonomy and technical specialization have been essential factors in the use of new technologies to further economic and social development in Peru. OSIPTEL, the Supervising Agency for Private Investment in Telecommunications, has strived since its beginning to develop policies based on the best practices worldwide. OSIPTEL’s goal is to develop a framework that stimulates operating companies to invest in, and develop the use of, today’s advanced convergent technologies and, thereby, help Peru improve its competitiveness in the international arena.

In Peru, connectivity is not considered in isolation, but in the context of a broad range of financial and technological considerations. The Peruvian Government has proactively sought to align its interests with the global leaders of the telecommunications sector. As a result, Peru has occupied a privileged position in the project and development strategies of the largest international operating companies active in the Latin American region.

Besides an active, constructive and innovative participation in the negotiation of service topics in the World Trade Organization, Peru chose to drive bilateral understandings to accelerate the processes and take the lead attracting investments and developing the activities of their operating companies.

The effort to achieve greater telecommunications connectivity to meet development goals has brought new challenges. In Peru, as in many other countries, the regulatory agency has had to take technical and legal measures to identify and register prepaid cell phone users, many of whom did meet the legal identification requirements due to slack point-of-sales identification procedures. In a joint effort, Peru’s central Government, with the technical, regulatory and supervisory support of the regulator, accomplished the registration of its prepaid cell phone users.

Special attention has been given to telecommunications security, a fundamental prerequisite for the development of such new services as eCommerce. The regulatory agency issued regulations to protect communications security and data privacy. This priority issue - for Peru and the world - is guaranteed by the Political Constitution of Peru, but demands technical instruments to enforce the constitutional and legal obligations.
The control mechanisms used guarantee the rights of communication service users. The control mechanisms include the supervision of telecommunications operators, regulatory compliance measures and technical verifications. These duties are the responsibility of Peru’s Ministry of Transportation and Communications; the Ministry structures and implements the sector’s policies.

The combination of technical measures and a common agenda with operating companies have brought the sought-for results - and new technologies promise even better protection for communications in the future.

Since Peru’s national, regional and local Governments are all involved in the complex task of building a modern, efficient, telecommunications system, coordinating the deployment of a nationwide infrastructure that meets the requirements of all three requires sustained effort. Although, by law, telecommunications infrastructure is national, in practice it is necessary to persuade, coordinate and consult with local and regional authorities to deploy and install any sort of infrastructures for the development of public services. Regulatory agencies and representative entities of the business sector, municipalities and regional Governments must work together within the participatory mechanisms established by Peruvian legislation to democratize Government decisions and efficiently represent the needs of all from public entities to individual citizens.

The user reconciliation process is an important part of the regulatory agency’s quest to achieve efficient connectivity. Accordingly, we seek to obtain the support of Government entities, business entities and citizens to foster progress in terms of infrastructure deployment. Obtaining citizen support of the necessary investment in infrastructure is an important part of the reconciliation process; without investment it is impossible to build the infrastructure for basic services, such as telephony, broadband or cable TV. l

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