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Colombia Telecommunications Report Q1 2008Product Type: Market Research ReportPublished by: Business Monitor International Published: November 2007 Product Code: R302-1844 Description As planned, Colombia’s Ministry of Communications has ordered the creation of a universal concessionlicence for long-distance telephony and internet services from August 2007. New operators will not berequired to have a certain number of lines installed or to accredit minutes a year ahead of applying for alicence. Liberalisation of both the long-distance and internet markets should lead to greater investment ininfrastructure and falling tariffs. There is other encouraging news that Mexico’s Telmex will be allowedto merge its Colombian cable TV operations, under certain conditions. The biggest concern for Telmex isthat it must sell one of the three brand names used in the capital Bogota, although it is not clear whichbrand this is. Telmex would be reluctant to dispose of the TV Cable brand, as it is the best known in thecity. But the move is a positive step both for Telmex and the market, which desperately needs outsideinvestment to boost next-generation technologies and services such as triple play. The broadband market in Colombia remains seriously underdeveloped, with newly released data from theITU indicating broadband take up at YE06 was not as high as we had thought, with penetration at 1.4%.However, we continue to expect strong growth in 2007 and beyond and have left forecasts unchanged forthe time being. In contrast, internet usage was slightly ahead of BMI’s analysis, with some 6.7mn regularinternet users at YE06, penetration of 14.5%. We have upgraded forecasts and now expect internetpenetration will reach 18% in 2007 and near 25% in 2011. There are encouraging signs of investment atthe fixed-line operators, especially Telefónica Telecom, which has trailed the pack in terms of broadbanddevelopment, and by Telmex in the triple play market, which should drive strong growth. However, withTelefónica Telecom recording two quarters of falling fixed-line subscriber numbers in H107, we haverevised forecasts downwards. We now believe the fixed-line market will rise by only 0.5-1% in 2007before beginning to decline in 2008, a year earlier than originally forecast. However, we continue tobelieve penetration will fall to 15% by YE2011 as the population grows to over 50mn people. Table of Contents
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