1. Valeria Jordan Innovation and Technology Unit ECLAC
Emerging challenges on ICT4D: the Latin America and Caribbean Perspective UNGIS meeting Geneva, October 2009
I would like to thank UNGIS and ITU for the invitation to be part of this panel.
I will try to give you an overview on the progresses achieved in Latin America and the Caribbean on ICT4D in order to identify the emerging challenges that the countries of the region are facing.
Valeria Jordan
Innovation and Technology Unit
ECLAC

2. I. The diffusion of ICTs in Latin America and the Caribbean2

3. Regional overview
Stagnation of fixed telephony penetration (18% - 19%)
Rapid expansion of mobile telephony
from 23% in 2003 to 70% in 2008
Increase of Internet access
from 11% in 2003 to 26% en 2008
Increase of broadband connections, but the penetration rate is still low (5%)
Expansion of mobile broadband (1% of total)
Insufficient increase of the international bandwidth
ICT trends within Latin America and the Caribbean closely follow those of other regions in the world. During the last years, fixed telephone line growth has stagnated -- in a penetration level of 19%. Meanwhile, mobile subscriptions have grown rapidly, moving from a penetration rate of 23% in 2003, to more than 70% in 2008.
At the same time, Internet penetration rates rose from 11% to 26%.
The Internet market in Latin America and the Caribbean is in the process of transformation, from dial-up to broadband access. Some countries like Brazil, Chile and Colombia, have made sectoral transformations, enhancing this process, so there is a significant growth of broadband connections, specially in the mobile modality. However, for the region, average broadband penetration rates remains low, reaching only 5% of the population.
Additionally, there is concern that the rising demand for broadband services is not followed by a sufficient increase of the international bandwidth that supports this expansion. In the near future, this may affect the quality and speed of the service.

4. Facing the external digital divide
Variation of the gap between OECD and LAC countries
The efforts undertaken have allowed for a reduction of the fixed and mobile telephony divide with developed countries. The chart shows the variation of the digital divide between OECD and Latin America and the Caribbean countries.
The Internet divide has not increased from 2002 due to the proliferation of public access facilities, such as cyber cafes, public libraries, telecenters, schools, but more efforts are needed in order to connect homes, particularly because of the impact of this kind of connection, that enables a better and more frequent use of ICT. A challenge related with this is to increase the access to computers, as this gap with developed countries is the one that is increasing the most.
The digital divide evolves with the development of new technologies, and for the region that implies new gaps particularly in broadband and international bandwidth that result in low and expensive Internet access :
- In OECD countries, the lowest monthly tariffs are around US$ 19 against US$ 29 in Mexico or US$ 35 in Chile.
- The average download speed reached 17 Mbps in OECD countries and 2 Mbps in the most developed countries in Latin America and the Caribbean.
The emerging challenges:
- spread broadband access
- increase access to terminals
- improve the quality of service

5. The real divide: the communication capacity (fixed and mobile telephony plus Internet)
For the development of the Information Society, what really matters is the capacity to transmit information, regardless of the service used. This is the real digital divide and the one that is rising most rapidly.
This is related with the access technologies available in the region. Latin America has lagged behind other regions in third-generation (3G) mobile adoption and broadband has been held back until the last two years.
In 1995, each inhabitant of OCDE countries had an average of 29 kilobits per second more of capacity to communicate than an inhabitant in Latin America and the Caribbean (35 kb/s/inhab. vs 6 kb/s/hbte). This gap grew -- to 436 kb/s/inhab in 2005 (622 kb/s/inhab) versus 186 kb/s/inhab)
So the challenge is not only to spread access but also it is to facilitate the introduction of newest technologies.
The access is not the only matter, so is the technology related.
Latin America has lagged other regions in third generation (3G) mobile
adoption and broadband has been held back

6. Mobile access. A challenge solved?
Despite the amazing expansion of mobile telephony, is necessary to point out the existing differences among the countries in the region, specially in the degree of access in the poorest segments of the population. As you can see in the chart, a significant gap in access to mobile telephony between the richest and the poorest remains in many countries in the region.
More than 80% of users are pre-paid, with no access to the Internet
Fuente: CEPAL, Sistema de Información OSILAC, sitio oficial en línea http: 6

7. Internet at home: a necessary effort for the real digital inclusion
Households with Internet access by country and income level
(%)
There is a significant gap between the highest income level and the lowest one, as a great heterogeneity among the countries in the region.
Regarding the Internet access, the divide increases between the most developed countries in the region and the less advanced ones, as well as among the different segments of the population within each country.
Source: OSILAC, CEPAL 7

8. The rural / urban digital divide
Households with mobile phone access (%)
Households with Internet access (%)
If we take a look at the geographical digital divide, the importance of mobile telephony to connect rural areas is evident. In many countries, the urban/rural gap has been bridged or significantly reduced.
But regarding the Internet, the situation is drastically different. In many countries the Internet has not reached rural areas yet, and in the countries where it has done so, the penetration levels in rural households are less than 5% in the majority of cases.
Source: CEPAL, OSILAC Information System, official web site http: Data based on household surveys of the countries. Most recent available year. The data from Spain originates from the National Statistical Office of Spain (INE).
In the case of Spain the urban category represents municipalities with more than inhabitants and provinces’ capitals, and the rural category represents the average of the remaining municipalities 8

9. Universal access through public access to ICT
Internet usage by location (%)
For the majority of the countries in the region, ICT public centers are the
predominant way to get Internet access
Public Internet access centres, including commercial Internet cafes, government sponsored community centres and connected educational establishments have spread to meet some of the demand for Internet access. But in many cases, the initiatives are not sustainable, not only because of the high cost associated, but also due to the lack of demand of the services on behalf the population.
People need to understand what they can do with the Internet and especially broadband access. A high percentage of responses in households surveys about the lack of home PCs and Internet access say: “not needed”, “not interested or do not know utility” and “do not know how to use”, which is clear evidence of this situation.
Thus, efforts are also needed to raise awareness and increase ICT training.
Source: CEPAL, OSILAC Information System, official web site http: Data based on household surveys of the countries. Most recent available year. The data from Spain and Portugal originates from Eurostat’s web site.

10. …emerging challenges co-existing with existing challenges
II. New developments…
…emerging challenges co-existing with existing challenges
New developments emerge with new challenges that have to be faced simultaneously with the existing ones that have not been resolved yet 10

11. Facing the market emerging challenges
Where a market exists, it is necessary:
to increase the network deployment, specially with new technologies
to foster affordable tariffs
to facilitate access to devices such as PCs
 Market forces will react positively under an adequate regulatory framework
Regulatory reforms to enable digital convergence
elimination of entry barriers to facilitate the introduction of IP-based technologies (VoIp)
promoting more competition in the broadband market to lower prices
spectrum allocation
Complementary public policies can be undertaken to facilitate access to devices, but innovative business models are also needed (prepaid, include equipment as a part of the service)
Latin America has made significant progress on ICT access, but much more remains to be done as new technological developments emerge.
The emerging challenges appear in two areas: where there is a market for ICT, and where there is not, due in general to low income levels.

12. Facing the emerging challenges for digital inclusion
Where there is not a market (non-profitable and rural areas) the challenge is to promote universal access to broadband.
Legal and institutional reforms that enable the use of existing universal access funds (12% has been used)
Innovative PPP are needed
Rethink the mechanism of universal access
Deployment of infrastructure by the State
Special incentives to the operators
Network-sharing mechanisms to foster competition among services

13. Facing the emerging challenges for digital inclusion
Continuing to support Internet public access, especially to broadband, but within an integral perspective that creates demand.
Information Society national strategies to:
increase digital literacy and awareness of ICTs. Public need to understand what they can do with the Internet.
add value to networks by developing content in local languages and useful applications for people, such as e-education, e-health, e-gov, etc.
involve policy-makers from other sectors and increase their awareness of ICT uses and potential, in order to contribute to ICT4D through public to public partnerships.
requires a multi-stakeholder approach, involving the community, public and private sector, donors, etc.

14. Reflections
There is not a unique solution, it depends on the characteristics of each country in terms of development degree, infrastructure, literacy, etc. and priorities.
In a region with such a scarcity of resources and multiple needs, it is not possible for a single actor to resolve all the issues. An approach involving multi-stakeholder partnerships is essential in order to move forward.
Finally, national coordination and intraregional cooperation are the efficient ways to work towards achieving common goals.

15. eLAC2010
Regional Action Plan for the Information Society in Latin America and the Caribbean
Regionally concerted strategy that conceives ICTs as instruments for economic development and social inclusion
Based in short-term action plans with quantitative and qualitative goals
eLAC2007: 30 goals and 70 activities ( )
eLAC2010: 83 goals ( )

16. Functional structure of eLAC2010
Observers
Private Sector
Civil Society

17. The priorities of eLAC2010 1. e-Education 2. Access and infrastructure
6. Policy instruments and strategies
4. Public management and e-gov
2. Access and infrastructure
1. e-Education
5. Production sector and e-business
3. e-Health

18. Thanks for your attention Innovation and ICT Unit Division of Production, Productivity and Management (DPPM) Economic Commission for Latin America and the Caribbean (ECLAC)