OECD Toolkit aims to spur high-speed Internet use in Latin America & the Caribbean | WPN World People News

Internet access and use is growing in Latin America and the Caribbean (LAC), but the region needs to move faster in adding broadband infrastructure, expanding access and services and equipping people with the right skills for firms and households to fully benefit, according to a new OECD report.

Fixed broadband penetration in Latin America & the Caribbean (2013-14)

Broadband Policies for Latin America and the Caribbean: A Digital Economy Toolkit, produced with the Inter-American Development Bank, aims to speed up the expansion of high-speed Internet and encourage households, firms and governments to use online services and business tools by sharing best practices across 26 countries in the region in everything from spectrum policy to E-health.

“The Internet holds tremendous promise for Latin America and the Caribbean, but it needs solid foundations in the form of broadband networks and other infrastructure,” said OECD Secretary-General Angel Gurría, launching the Toolkit at the OECD’s 2016 Digital Economy Ministerial Meeting. “The goal is to provide affordable Internet to all and then cultivate the online tools and digital literacy that will drive innovation and productivity in the region.”

The LAC region has more than one mobile phone subscription for every inhabitant, yet 300 million people – half the population – have no access to the Internet. For fixed networks there is an average of 10 subscriptions per 100 people compared to 28 per 100 people in OECD countries, with large differences between countries, regions and income groups.

Meanwhile, mobile broadband is growing apace with an average of 50 subscriptions per 100 people versus 81 for OECD countries. While most people in LAC will likely get their first Internet connection via mobile services, fixed and mobile technologies are complementary as wireless networks can only operate efficiently if they have fixed backhaul networks.

Mobile broadband and telephone penetration in Latin America & the Caribbean (2014)

High-speed Internet remains expensive in the LAC region relative to income levels. The cheapest prices for fixed broadband in mid-2015 ranged from USD 15 to more than USD 50.

For households and firms, the Internet’s value comes from the adoption and use of digital technologies. Firms that are excluded from e-commerce and the digital management of global value chains are at a growing disadvantage. The share of businesses with their own website varies from 11% in Suriname to over 70% in Chile and Brazil. The weighted average for the region is around 60%, compared to an OECD average of 71%, though firms in Mexico, Bolivia and Central America have made rapid progress over the last decade.

The Toolkit says governments should make high-speed Internet more accessible and affordable to people living in remote or rural areas. Given the often daunting geography of rainforests, deserts, mountain ranges and small islands, they should avoid over-taxing the sector and set incentives or offer financing when markets cannot meet demand alone.

It notes that competition – which can keep prices in check, promote innovation and improve responsiveness to demand – tends to be weak in the LAC region’s communication sector. It recommends changes to laws that discourage new entrants and reforms to ensure the complete liberalisation of telecoms markets. Making regulators independent is the most effective way to address market dominance issues and lower barriers to new entrants. Mexico and Argentina are good examples of independent and “converged” regulators that oversee both the telecoms and audiovisuals sectors.

Examples of innovation in the Toolkit include Guatemala’s use of telemedicine to reduce maternal and neonatal mortality, Peru’s mobile payment systems, Brazil reducing a specific tax on M2M SIM cards by 80% and Uruguay giving laptops to all primary school students.

Source: Organization for Economic Co-operation and Development