Ecuador Telecommunications Report 2015
Regulatory changes at the beginning of 2015 continue to advance the more controversial aspects ofoperating in Ecuador's telecoms market. In the past, the government has shown a tendency to protect CNTfrom private competition and the new regulation instituted during 2015 will not change this trend, withadditional taxation and high cost of 4G spectrum licences. The launch of 4G by Claro and Movistar willbring competition to this segment where CNT has operated exclusively since 2013. Broadband will be oneof the fastest growing sectors over our forecast period, backed by CNT investment in fibre and coverageexpansion beyond major towns and cities.
Although 4G services were launched by incumbent Corporación Nacional de Telecomunicaciones in late2013, we see little prospect of the service taking off before more spectrum is awarded to other players. Themove to favour state-owned CNT does not bode well for its internationally-owned rivals Claro andMovistar, the operators that have the greatest potential for rolling out 4G services in the country. BMIbelieves that the country's politics is playing too large a role in telecoms policy, which will have long-termnegative effects on the market's growth. Ecuador has passed 100% penetration and sees a notable slowdownin growth potential. Opportunities are in 3G and content, which should entice consumers to spend more.
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