Paraguay is considering tapping into the transatlantic fiber-optic network by laying cables through Brazil’s Paraná state. Estimated to take one year, the project would push down broadband prices in the landlocked South American country.
According to a statement posted on the website of the country’s telecom regulator Conatel, the Inter-American Development Bank would facilitate negotiations with Brazilian authorities and provide technical assistance for the project.
Paraguay’s rugged geographic terrain has forced it to remain dependent on neighboring nations for interconnection. “This has driven up the price of telecom services, particularly broadband,” says a report from telecom research firm BuddeComm.
Paraguay has not disclosed how much money it has set aside for the cable project. Reports say the regulator is busy organizing meetings between different ministry officials to discuss how to negotiate with Brazil. According to the blueprint, Paraguay will have laid the cables by early 2016.
Since 2011, the Paraguayan government has vigorously supported the deployment of a nationwide fiber-optic backbone to reduce broadband prices. But its landlocked position has deterred private operators from building a fixed line network in sparsely populated regions.
But Carlos Slim’s subsidiary, Claro Paraguay, has recently revealed plans to invest around US$100 million in the expansion of its infrastructure in order to maintain its growth. With more than 7% of the market share, Claro is the third largest operator in Paraguay.
Another problem plaguing Paraguay’s telecom market is that the state-owned carrier Copaco has long retained a monopoly on all fixed-line voice services. In the mobile market, however, there has been competition since 1998, and there are over a dozen ISPs offering services.