Contents

Introduction

The telecoms sector of Latin America's third most populous nation has always been an arena for great potential, and over the last six years the changes have been constant. Marked by a near-dominant player in the mobile market, with fixed line operators enjoying strong market power in geographically separate areas but no operator with nationwide coverage, there have been cries for regulatory changes to reshape the sector.

Fueling this need was a large divide between the urban centers and the rural population, where accusations of centrism and elitism still resound, showing that there is still much to be done in terms of inclusion.

There was indeed a major regulatory reform in 2009, and a number of successive events, from new market entries to transparent spectrum auctions, have propelled that latent potential into something far more tangible. Spurred by recent free trade agreements and economic growth above many neighboring countries, the Colombian government has gotten more serious about addressing the remaining issues that stand in the way. In fact it has placed more and more emphasis on the power of IT and telecoms services, not to mention the industry itself, as a motor to help develop the general economy.

One of the ways that President Juan Manuel Santos has chosen to improve Colombia's position has been to prepare the country for entry into the Organization for Economic Co-operation and Development (OECD). As part of this, authorities invited OECD experts to perform an exhaustive review of telecom sector, with special attention given to the regulatory apparatus, and how it influences competition and development.

As a result, the OECD Review of Telecommunication Policy and Regulation in Colombia was published in April 2014, providing some critical observations of the competitive environment, and not just for mobile, which to some extent has been the focus of policy-making in recent years. Thus, the OECD drew attention to the pricing, penetration and connection speeds of broadband, and the regulatory body's apparent lack of autonomy, given that the recommendations of its technical professionals can potentially conflict with policy makers who have one eye on the next election.

In the year and a half that has passed since the OECD review, some things have changed, some have not, but what is clear is that the government did read the report and is starting to make more adjustments.

In our annual review of Colombia's telecom sector we analyze the current state of the market, the recommendations proposed by the OECD and what the government has proposed for the next three years.

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