Spotlight: State telco Antel's Uruguay investments

Uruguayan state operator Antel invested US$145mn in 2021, US$20mn more than in the previous year.

Antel allocated 85% of the funds to replace copper cables with fiber and to complete fiber optics networks in localities with more than 5,000 residents. It aims to have fully replaced copper cables by 2024.

Major amounts also went to installing 4G antennas and cellular network expansion, modernizing the information system, and preparing the network for 5G, according to a press release.

For this year, the company projects US$172mn for fiber deployment and a gradual 5G launch.

According to June 2021 figures from regulator Ursec, Uruguay had 11,980km of fiber optics deployed, mostly belonging to Antel.

The company is implementing a plan to take fiber optics to 44 localities.

Departments with the largest fiber optics networks are Montevideo, with 2,000km, and Canelones, with 1,411km.

Focused on fiber optics and mobile telephony, Canelones will receive this year’s bulk – US$16mn – of Antel’s investments. Last year, the department received half that amount. Of the total, US$3.6mn will be for reinforcing 74 base stations and building mobile infrastructure at 24 sites.

Antel will allocate US$8.5mn to Montevideo department, compared to US$9mn last year. Funds will go to fiber optics in Playa Hermosa, Playa Verde, La Capuera, Balneario Solís, Aiguá, Punta Colorada, San Francisco, and Cerro Pelado de Maldonado. An additional US$3mn are earmarked for submarine cable works.

In Colonia department, Antel will invest US$5mn, compared to US$6mn in 2021. The investments will be for fiber in towns and rural areas.

In February, fiber optics works for US$100,000 started in Mariscala town, Lavalleja department, and are expected to be completed by mid-year. With 308km, the department has among the smallest fiber optics network, according to Ursec.

In early March, Antel announced the start of fiber optics installation in José Pedro Varela town, also in Lavalleja.

Antel will also invest US$800,000 this year in Soriano department for fiber optics in Palmitas, Santa Catalina and Rodó, as well as new base stations.

4G and 5G

Antel was the first operator in Latin America to activate 5G base stations in 2019. However, the deployment did not continue. Uruguay is mulling to launch a 5G spectrum auction this year.

Although Antel has some 5G fixed wireless broadband pilots in the 28GHz band, they are not feasible for mass deployment.

Meanwhile, Antel aims to install 40 more 4G antennas in remote areas. In 2021, Antel installed 50 base stations in the country’s interior.

RESULTS

The company announced a net profit of US$247mn in 2021, "the best economic result since records have been kept," Antel chief Gabriel Gurméndez said in a statement.

This growth was due to improved efficiency, leading to a 10% opex drop. The company has a policy of maintaining costs, cutting advertising expenses, and not renew vacancies to achieve greater staff efficiency, among others. The operative margin was 31%.

Gurméndez said the tight control of expenses also allowed a reduction in the average price per gigabyte, which translated into a 50% mobile and 17% fixed traffic growth.

The mobile customer base grew 6%, fixed internet 4%, and fixed telephony 3%.

On March 27, a referendum also involving continued number portability will take place. In the first 40 days of the year, Antel gained 2,500 clients, but local newspaper La Diaria reported the trend has reversed and Antel registered a negative balance.

However, Antel remains leader with an accumulated balance of 1,550 new clients, followed by Claro with 130 new clients. Movistar registered a negative balance of 1,700 since number portability was introduced.

Antel had 53% of the mobile market in June 2021, followed by Movistar (29%) and Claro (17.8%).