OECD review of telecommunication policy and regulation in Colombia

167 Pages·2014·2.531 MB·English

by  OECD

OECD Review of Telecommunication Policy
and Regulation in Colombia
Contents
OECD Review of
Executive summary
Chapter 1. The telecommunication sector in Colombia Telecommunication Policy
Chapter 2. Regulatory structures and their reform in Colombia
Chapter 3. A ssessment and recommendations: Towards a more efficient telecommunication sector and Regulation in Colombia
in Colombia
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OECD Review
of Telecommunication
Policy and Regulation
in Colombia
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3
FOREWORD –

Foreword
This study was carried out by the OECD Directorate for Science, Technology and
Industry (DSTI) under the auspices of the Committee on Digital Economy Policy (CDEP,
formerly known as the Information, Computer and Communications Policy Committee,
“ICCP Committee”) and the Working Party of Communication Infrastructure and
Services Policy (CISP Working Party). It was requested by the Government of Colombia,
through the Ministry for Information and Communication Technology (Ministerio de
Tecnologías de la Información y las Comunicaciones, MINTIC) and the Communications
Regulation Communication (Comisión de Regulación de Comunicaciones, CRC), both
being in charge of representing Colombia at the CDEP and the CISP Working Party.
The OECD review of telecommunication policy and regulation draws on responses by
the Colombian authorities to a questionnaire and on the results of an extensive series of
interviews with major communication stakeholders during a fact-finding mission in
Colombia. The report was jointly peer reviewed by the CDEP and the CISP Working Party
on 11 December 2013, with Ms. Tracey Weisler (Federal Communications Commission,
FCC, United States) and Dr. Bengt Molleryd (Postal and Telecommunications Authority,
PTS, Sweden) as the lead peer reviewers. It was finalised in January 2014 and reflects
developments up to that time.
The review was drafted by Mr. Agustín Díaz-Pinés and Ms. Alexia González Fanfalone,
both economists at the Information, Communications and Consumer Policy Division (ICCP)
in DSTI, with contributions from Dr. Sam Paltridge, Head of the Telecommunications Unit
(DSTI/ICCP), Dr. Rohan Samarajiva, Chair, LIRNEasia, and Dr. Ernesto Flores-Roux,
CIDE, Mexico.
The review was made possible by the support from the MINTIC and the CRC. The
OECD Secretariat wishes to thank, in particular, Minister Diego Molano Vega, Minister
for Information and Communication Technology, Dr. Pablo Márquez Escobar, Executive
Director of the CRC, and their staff for organising the mission and the interviews and
providing additional factual information throughout the review process. The OECD also
wishes to acknowledge the assistance of Ambassador Federico Renjifo Vélez and Ms.
Johana Moreno Kuratomi, from the Colombian Embassy to France, for their support in
the review process.

OECD REVIEW OF TELECOMMUNICATION POLICY AND REGULATION IN COLOMBIA © OECD 2014

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TABLE OF CONTENTS –

Table of contents
Executive summary ............................................................................................................................................ 9
Introduction ...................................................................................................................................................... 9
Main recommendations .................................................................................................................................. 11
Chapter 1. The telecommunication sector in Colombia................................................................................ 15
1.1. Introduction ............................................................................................................................................. 16
1.2. The national context for telecommunication policies .............................................................................. 18
1.3. Telecommunication market participants, market performance and the regulatory framework ............... 19
1.4. Telecommunication markets: Developments in competition .................................................................. 23
1.5. Price and quantity indicators ................................................................................................................... 32
1.6. Investment figures ................................................................................................................................... 38
Notes............................................................................................................................................................... 40
References ...................................................................................................................................................... 42
Chapter 2. Regulatory structures and their reform in Colombia ................................................................ 43
2.1. The regulatory regime ............................................................................................................................. 43
2.2. Regulatory institutions ............................................................................................................................ 47
2.3. The regulatory regime ............................................................................................................................. 59
2.4. Regulations and related policy instruments in the telecommunication sector ......................................... 63
2.5. Competition policy .................................................................................................................................. 81
2.6. Convergence of communication markets ................................................................................................ 84
2.7. Infrastructure deployment: Rights of way, infrastructure sharing and next generation access ............... 88
2.8. Spectrum policy ....................................................................................................................................... 93
2.9. Universal service ..................................................................................................................................... 99
2.10. Foreign and state ownership of telecommunication operators ............................................................ 108
2.11. Consumer protection and empowerment ............................................................................................. 110
Notes............................................................................................................................................................. 123
References .................................................................................................................................................... 131
Chapter 3. Assessment and recommendations: Towards a more efficient telecommunication sector
in Colombia ..................................................................................................................................................... 135
3.1. Conclusions ........................................................................................................................................... 136
3.2. General assessment of current strengths and weaknesses ..................................................................... 137
3.3. Potential benefits of further regulatory reform ...................................................................................... 141
3.4. Recommendations ................................................................................................................................. 142
References .................................................................................................................................................... 157
Annex A. Summary of OECD basket prices in Colombia .......................................................................... 159
Annex B. Basket prices in Colombia compared to selected LATAM countries ....................................... 161
Annex C. Summary of the main initiatives of “Plan vive digital” .............................................................. 163

OECD REVIEW OF TELECOMMUNICATION POLICY AND REGULATION IN COLOMBIA © OECD 2014
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– TABLE OF CONTENTS

Figures
Figure 1.1. Colombia telecommunications revenue ...................................................................................... 19
Figure 1.2. Fixed access paths (per 100 inhabitants): Colombia compared to other OECD countries,
end of 2011 ................................................................................................................................. 20
Figure 1.3. Cellular mobile subscriptions per 100 inhabitants, end 2011 ..................................................... 21
Figure 1.4. Mobile subscriptions per 100 inhabitants, Colombia compared to other OECD countries,
end 2011 ..................................................................................................................................... 22
Figure 1.5. Fixed broadband subscriptions per 100 inhabitants, Colombia compared to other OECD
countries, end 2012 ..................................................................................................................... 23
Figure 1.6. Pay-tv providers in Colombia: Subscriber market share ............................................................ 31
Figure 1.7. OECD fixed broadband basket including Colombia >256 Kbps, 2 GB, June 2013 ................... 34
Figure 1.8. OECD fixed broadband basket including Colombia, >15 Mbps, 33 GB, June 2013 ................. 34
Figure 1.9. OECD wireless broadband basket, including Colombia, tablet 500 MB, June 2013 ................. 35
Figure 1.10. OECD wireless broadband basket including Colombia, laptop 5 GB, June 2013 ...................... 36
Figure 1.11. OECD 100 calls + 500 MB mobile basket, including Colombia, VAT included, May
2013 ............................................................................................................................................ 36
Figure 1.12. Actual broadband speeds - Akamai, Ookla and M-Lab data, Q2 2012 ...................................... 37
Figure 1.13. Broadband penetration by speed tiers (in terms of actual speeds), Colombia compared to
the OECD, 2012 ......................................................................................................................... 38
Figure 2.1. Plan Vive Digital ........................................................................................................................ 48
Figure 2.2. Maximum interconnection charges ............................................................................................. 67
Figure 2.3. Mobile termination rates in Colombia and OECD average ........................................................ 68
Figure 2.4. Mobile termination rates in Colombia and OECD countries, October 2012 .............................. 69
Figure 2.5. Mobile markets shares (lines) for post-paid and pre-paid, Q3 2013 ........................................... 72
Figure 2.6. Market share evolution (subscribers) .......................................................................................... 72
Figure 2.7. Overview of hosting countries of .co-sites ................................................................................. 92
Figure 2.8. Fixed line penetration by department, Q3 2013 ....................................................................... 100
Figure 2.9. Coverage of fibre backbone networks, heads of municipalities ............................................... 101
Figure 2.10. Market efficiency and access gaps............................................................................................ 105
Figure 2.11. FONTIC expenditures .............................................................................................................. 106
Figure 2.12. Procedure for consumer complaints in Colombia (communications services) ......................... 112
Figure 2.13. Net number portability balance, implementation of regulation, August 2011-July 2013 ......... 115
Figure 2.14. Percent average of dropped calls by mobile network operator by zone, Q3 2013 .................... 119
Figure 2.15. Percent average of failed call attempts in 2G and 3G networks, Q1 2013 and Q3 2013 .......... 119
Figure 2.16. Broadband download speed (Kbps) selected LATAM countries 2009-2013 ........................... 122

Tables
Table 1.1. Fixed line penetration, lines per 100 inhabitants, 2006 and 2011............................................... 21
Table 1.2. Number of operators, 2012 ......................................................................................................... 23
Table 1.3. Key market participants in Colombia’s telecommunication sector, May 2013 .......................... 24
Table 1.4. Market share in Colombia's telecommunication market, Q3 2013 ............................................. 25
Table 1.5. Fixed lines in service, 2010-2013, compound annual growth rate (CAGR) ............................... 26
Table 1.6. First spectrum allocations ........................................................................................................... 28
Table 1.7. Fixed and mobile voice baskets: Colombia's performance compared with OECD,
May 2013 .................................................................................................................................... 33
Table 1.8. Investment as reported by main operators .................................................................................. 39
Table 2.1. Comparison of the powers of the CRC and the CRT.................................................................. 45
Table 2.2. Synopsis of telecommunication regulation in Colombia ............................................................ 46
Table 2.3. Main regulatory developments in Colombia since liberalisation................................................ 62
Table 2.4. Relevant markets, analysis and remedies ................................................................................... 64
Table 2.5. Termination rates from 2012 onwards ........................................................................................ 69
OECD REVIEW OF TELECOMMUNICATION POLICY AND REGULATION IN COLOMBIA © OECD 2014
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TABLE OF CONTENTS –

Table 2.6. Average HHI by type of municipality, 2010 and 2012 ............................................................... 76
Table 2.7. Regulatory measures being applied in OECD countries but absent/or weakly
implemented in Colombia........................................................................................................... 80
Table 2.8. National coverage of digital terrestrial television ....................................................................... 87
Table 2.9. Approaches to NGA market structure, access and development in selected economies ............ 90
Table 2.10. Historical spectrum allocations in Colombia .............................................................................. 94
Table 2.11. 2013 spectrum auction ................................................................................................................ 96
Table 2.12. Current spectrum holdings (as of July 2013) .............................................................................. 97
Table 2.13. Stratification in Colombia, former system .................................................................................. 99
Table 2.14. International mobile roaming charges, voice and SMS ............................................................ 113
Table 2.15. QoS indicators reported to the CRC ......................................................................................... 118

Boxes
Box 2.1. Main features of Law 1341 of 2009 (The ICT Law) .................................................................. 44
Box 2.2. Draft “antimonopoly” law for mobile communications ............................................................. 82
Box 2.3. Conditions for the 4G spectrum auction ..................................................................................... 95
Box 2.4. Universal service related initiatives under Plan Vive Digital ................................................... 101
Box 2.5. Measuring broadband speeds in the United Kingdom and the United States ........................... 121
Box 3.1. Strengths of Colombia’s telecommunications regulatory framework ...................................... 138
Box 3.2. Weaknesses of Colombia’s telecommunications regulatory framework .................................. 140
OECD REVIEW OF TELECOMMUNICATION POLICY AND REGULATION IN COLOMBIA © OECD 2014