It is impossible to participate in a telecommunications event in which digital inclusion is not mentioned as the objective of all market players. A laudable and necessary objective if all the positive externalities that information and communications technologies (ICT) bring when they reach sectors that previously did not have connectivity, but not only with coverage but with a broader plan that includes intangible elements such as applications, software and training of teachers or others interested in using the technology. It is for this reason that it is necessary to take a step back and explore with more emphasis what digital inclusion means and implies for the countries and territories of the Americas.
The concept of “digital inclusion” refers to the adoption of ICT by all strata of society, mainly the population’s ability to access high-speed broadband services. One of the recipes of governments to promote digital inclusion and thus reduce the different existing digital gaps is to increase the percentage of the population with access to mobile or fixed broadband services.
Achieving this objective is not easy as it requires long-term strategic plans in which various entities will be responsible for bringing connectivity to all locations in a country. In other words, the connectivity plans that are being formulated, focused on service coverage through affordable platforms for the population, focus on defining the alternatives available to achieve this end.
The examples observed at the Latin American level show us from service extension requirements as part of the concession to offer telecommunications access services to the incorporation of coverage requirements to localities, towns, schools, road or other entities that the government identifies as part of a radio spectrum concession for mobile services. This last alternative, initially mainly used by Chile, has been gaining followers at the regional level and has been adapted to be incorporated into spectrum allocation processes in markets such as Argentina, Brazil, Colombia and the Dominican Republic.
If we focus on the Colombian market, we observe that, in the world of fixed broadband services, the ICT Ministry (MINTIC) shows us that the download speed of an Internet connection in a stratum 6 household (66.7 Mbps ) is 9 times faster than a stratum 1 household Internet connection (7.2 Mbps). Without instead of households, we study the situation in the different departments of the country, we see that those identified by the MINTIC with fewer fixed Internet lines per 100 people and lower average download speeds, – Vaupés, Vichada, La Guajira , Guainía and Chocó – are those that, according to the Basic Needs Index published by the National Administrative Department of Statistics (DANE), have the highest percentage of their population living in poverty levels.
Looking at the mobile world of this South American country, the first 4G auction of 2013 ordered the deployment of this technology in all the municipal capitals of the country. Six years later the MINTIC affirmed that 90% of the populated centers lacked this technology. It is clear that providing coverage to a municipal seat does not mean offering service to all the inhabitants of the municipality. For this reason, the second 4G auction held in 2019 aimed to boost 4G coverage in 5,766 populated centers that until then lacked it.
However, a key element in the adoption of all mobile technology, such as 4G, is the availability of phones that support this technology. Figures from the MINTIC show that at the end of 2020, Colombia had 67.7 million accesses to mobile service, of which some 32.5 million accessed mobile broadband services and only 75% accessed 4G services. In other words, only 48% of the country’s cell lines accessed mobile broadband services.
Estimates of the global consultancy Counterpoint Research indicate that on average Colombians change their cell phone every 28 months, therefore, to access a more modern device that allows the use of new applications and a better Internet connection, it takes more than two years. Perhaps for this reason, according to said consultancy, at the end of 2020 there were 29.6 million cell phones capable of connecting to a 4G network or 44% of all cell phones in operation.
More recent numbers from this consultancy indicate that the installed base of phones capable of connecting to 4G networks in Latin America at the end of 2020 was 55%, with preliminary estimates for the end of 2021 of reaching 62%.
If we consider that according to the British consultancy OMDIA, the number of mobile lines connected to people was 708 million at the end of 2020 and projected to reach 720 million by the end of 2021, this means that even in the hypothetical case that all users are under coverage of 4G and 5G networks, some 319 million users would not have been able to connect to them in 2020, reducing this number to 274 million by the end of 2021. The reason? Outdated cell phones that do not operate on the two most recent mobile generations.
If we look at Mexico, we can see that, at the end of 2020, according to the Mexican consulting firm The CIU, the country had 125.7 million cell lines, of which 91.89% had a smartphone. However, according to the Telecommunications Information Bank (BIT) of the Federal Telecommunications Institute (IFT) of Mexico, it indicates that by the end of 2020 only 82.49% of active cell phones were accessing mobile Internet services. The IFT, as neither do the vast majority of regulatory bodies on the planet, still does not discriminate the type of mobile Internet that users can access, so an EDGE connection is accounted for in the same way as an LTE.
At first glance, these numbers do not seem serious, since we are just talking about a gap of just 17% of the active cell lines in the country. Above all, if you are aware of the information published by The CIU, a consultancy that estimates the cell phone replacement rate in Mexico in 24 months. This replacement will help so that by the end of 2021 the number of smart devices in the hands of Mexicans reaches some 122 million or 94% of the total in use, with the vast majority of these new devices capable of connecting at least to 4G networks.
The problem with looking at aggregate figures is that it only presents one side of the coin. If we look at the data published for the end of 2020 by the BIT, we find that the difference in percentage points in the penetration of the use of cellular service for voice versus its use for the Internet is 27 percentage points in the state of Chiapas, 23 in Oaxaca, 19 in Guerrero, 20 in Puebla and 22 in Zacatecas. Obviously, so that there are no doubts, the number that has the advantage is that of telephony.
There are many reasons for this disparity ranging, as was observed in the Colombian example, in the lack of telephones that can connect to more advanced networks up to the purchasing power of the population. It is impossible to ask those who live in extreme poverty, a figure that has increased in Mexico in the past 18 months according to data from the Economic Commission for Latin America (ECLAC) to increase their monthly spending on telecommunications services or to change their cell phone for one. more modern.
Why all this explanation using two of the most important markets in Latin America as a base? Simple, promoting digital inclusion goes beyond the availability of service coverage, it also implies promoting accessibility to it through appropriate devices.
Likewise, any digital inclusion strategy cannot be conceived as an isolated phenomenon for which only the authorities related to the ICT sector have to be held responsible. A digital inclusion strategy will be successful when it is accompanied by schemes that aim at poverty reduction, expansion of civil infrastructure and the establishment of schemes that facilitate the migration of users to new mobile technologies under a long-term public policy as the need connectivity of the population does not expire.
It is not enough that the coverage provides the service, there must be incentives so that they can be hired and used. Otherwise, any digital transformation scheme will drive a greater number of digital gaps among the most vulnerable segments of the population.