Chile - Telecommunications SectorChile - Telecommunications Sector
Overview
Chile has the most modern and mature telecommunications infrastructure in Latin America. Since its privatization in 1980, the telecom sector has continued growing year after year. However, the sector needs to double the investment in infrastructure to overcome the existing digital gap. The Government of President Piñera has made clear its commitment to boosting telecommunications in Chile. Its goal is to increase investment by 30 percent per year to reach a level of US$ 2 billion, the level reached during his first government.
Minister of Transportation and Telecommunications Gloria Hutt stated in May 2019 that the principal goal of this government is to reduce the digital gap that exists today in Chile and to promote competition and quality of services. Pamela Gidi, Under Secretary of Telecommunications, added that the government is seeking to make Chile a leader in the digital revolution and a hub in the region through the proactive implementation of technologies like 5G. Subtel is also promoting several public-private partnership (PPP) models to finance telecoms infrastructure investment over the next five years. The agency wants to work with electric power distributors to take advantage of electric power infrastructure to hang fiber and use rural schools as connectivity hubs.
Unit: USD millions
(total market size = (total local production + imports) - exports)
Source: Estimates based on industry sector sources and Customs data.
Opportunities
The Chilean Government has emphasized the need to increase investment in telecommunications infrastructure to carry out Chile’s priority programs before the end of President Piñera’s administration, the deployment of 5G, the submarine fiber optic cable between South America and Asia and eliminate the existing digital gap that currently exists.
Deployment of 5G in Chile
Subtel launched a public consultation on the use of 700MHz, AWS, 3.5GHz and 28GHz bands for 5G networks. The results of the consultation were varied, but showed that people foresee 5G benefitting principally entertainment, education, industrial production, intelligent agriculture, and internet access.
At the beginning of February 2019, Subtel said it had decided to promote pilot projects for developing and testing 5G technology in different sectors of the economy, prioritizing intelligent industries such as the development of autonomous vehicles and the application of IoT in mining and agriculture.
Subtel allowed telecom operators to test 5G technology in the 3.5 GHz ban. WOM, Claro Chile and Entel carried out the first 5G demos in the country. WOM used the Chinese equipment of Huawei, Claro employed equipment from Nokia and Entel worked with Ericsson. WOM is the only operator without spectrum in the 700mHz band; the 20MHz remaining in the band was originally reserved by Subtel for public emergency services.
Submarine Fiber Optic Cable between Latin America and Asia
One of President Piñera’s priorities in the telecommunications sector is the Submarine Cable Project between Latin America and Asia. The project would be the first underwater fiber optic cable to directly connect Asia with Latin America and would help drive interconnectivity, trade, investment, as well as scientific and cultural exchanges between two continents. In 2017, the Chinese government prepared a pre-feasibility study using Huawei equipment on the potential routes to be followed by the submarine cable. The route is approximately 20,000 to 24,000 kilometers and the estimated cost is US$ 600 million.
In September 2019 Subtel awarded the Feasibility Study for the Submarine Fiber Optic Cable Project to a consortium comprised of TMG Telecom and WFN Strategies. The study will examine several components of the project including on a demand study, potential routes, traffic projection for existing and future cables. The final study will be delivered on May 26, 2020 and is being funded by the Development Bank of Latin America, CAF.
Chile’s plan is to create a hub to serve demand from other Latin American countries. The Chilean Government wants to attract other countries to participate in this project, considering it a public-private partnership. The French Polynesia, Brazil and Argentina have already expressed interest in joining and sharing the cost. The Japanese company, NEC, that is also a submarine cable supplier, believes that the cable is economically feasible since demand will more than pay for it.
Web Resources
Undersecretary of Telecommunications
Ministry of Transportation and Telecomunications
For additional information please contact: isabel.valenzuela@trade.gov
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.
Chile has the most modern and mature telecommunications infrastructure in Latin America. Since its privatization in 1980, the telecom sector has continued growing year after year. However, the sector needs to double the investment in infrastructure to overcome the existing digital gap. The Government of President Piñera has made clear its commitment to boosting telecommunications in Chile. Its goal is to increase investment by 30 percent per year to reach a level of US$ 2 billion, the level reached during his first government.
Minister of Transportation and Telecommunications Gloria Hutt stated in May 2019 that the principal goal of this government is to reduce the digital gap that exists today in Chile and to promote competition and quality of services. Pamela Gidi, Under Secretary of Telecommunications, added that the government is seeking to make Chile a leader in the digital revolution and a hub in the region through the proactive implementation of technologies like 5G. Subtel is also promoting several public-private partnership (PPP) models to finance telecoms infrastructure investment over the next five years. The agency wants to work with electric power distributors to take advantage of electric power infrastructure to hang fiber and use rural schools as connectivity hubs.
Unit: USD millions
| 2016 | 2017 | 2018 | 2019 estimated | |
| Total Market Size (1) | 84 | 110 | 122 | 142 |
| Total Local Production (2) | 48 | 50 | 78 | 83 |
| Total Exports | 648 | 640 | 705 | 724 |
| Total Imports | 126 | 180 | 212 | 302 |
| Imports from the U.S. | 732 | 750 | 827 | |
| Exchange Rate: 1 USD | 676 | 649 | 621 | N/A |
Source: Estimates based on industry sector sources and Customs data.
Opportunities
The Chilean Government has emphasized the need to increase investment in telecommunications infrastructure to carry out Chile’s priority programs before the end of President Piñera’s administration, the deployment of 5G, the submarine fiber optic cable between South America and Asia and eliminate the existing digital gap that currently exists.
Deployment of 5G in Chile
Subtel launched a public consultation on the use of 700MHz, AWS, 3.5GHz and 28GHz bands for 5G networks. The results of the consultation were varied, but showed that people foresee 5G benefitting principally entertainment, education, industrial production, intelligent agriculture, and internet access.
At the beginning of February 2019, Subtel said it had decided to promote pilot projects for developing and testing 5G technology in different sectors of the economy, prioritizing intelligent industries such as the development of autonomous vehicles and the application of IoT in mining and agriculture.
Subtel allowed telecom operators to test 5G technology in the 3.5 GHz ban. WOM, Claro Chile and Entel carried out the first 5G demos in the country. WOM used the Chinese equipment of Huawei, Claro employed equipment from Nokia and Entel worked with Ericsson. WOM is the only operator without spectrum in the 700mHz band; the 20MHz remaining in the band was originally reserved by Subtel for public emergency services.
Submarine Fiber Optic Cable between Latin America and Asia
One of President Piñera’s priorities in the telecommunications sector is the Submarine Cable Project between Latin America and Asia. The project would be the first underwater fiber optic cable to directly connect Asia with Latin America and would help drive interconnectivity, trade, investment, as well as scientific and cultural exchanges between two continents. In 2017, the Chinese government prepared a pre-feasibility study using Huawei equipment on the potential routes to be followed by the submarine cable. The route is approximately 20,000 to 24,000 kilometers and the estimated cost is US$ 600 million.
In September 2019 Subtel awarded the Feasibility Study for the Submarine Fiber Optic Cable Project to a consortium comprised of TMG Telecom and WFN Strategies. The study will examine several components of the project including on a demand study, potential routes, traffic projection for existing and future cables. The final study will be delivered on May 26, 2020 and is being funded by the Development Bank of Latin America, CAF.
Chile’s plan is to create a hub to serve demand from other Latin American countries. The Chilean Government wants to attract other countries to participate in this project, considering it a public-private partnership. The French Polynesia, Brazil and Argentina have already expressed interest in joining and sharing the cost. The Japanese company, NEC, that is also a submarine cable supplier, believes that the cable is economically feasible since demand will more than pay for it.
Web Resources
Undersecretary of Telecommunications
Ministry of Transportation and Telecomunications
For additional information please contact: isabel.valenzuela@trade.gov
Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.