Chapter 1. Broadband and beyond in Latin America and the Caribbean

This introductory chapter provides background for all other chapters in this Toolkit. It discusses the role of broadband in accelerating economic and social development, the need for holistic broadband policies and the objective of a regional broadband policy toolkit. It also provides an overview of the situation in the Latin America and Caribbean region, by presenting leading indicators as well as opportunities and challenges related to broadband deployment and adoption. This chapter concludes by summarising good practices identified throughout the Toolkit.

  

Broadband Internet access is playing an increasingly transformative role across all economic sectors and societies, in the Latin American and Caribbean (LAC) region. It has become a key digital tool for enabling individuals, businesses and governments to interact with and among each other. It empowers users in their daily lives, through its potential to expand social inclusion and facilitate communication for disadvantaged groups; it advances productivity, by increasing the information base, efficiency and innovation; and it improves governance, by reducing co-ordination costs and allowing greater participation and accountability.

While the potential benefits of using broadband networks are undeniable, several challenges lie ahead in the LAC region. First, broadband networks must be readily and universally accessible, and while progress has been made, much remains to be done. In the LAC region alone, an estimated 300 million people, half of the population, have no access to the Internet. Without access, the opportunities for economic and social development that broadband offers are denied to individuals, communities and businesses.

Second, policies and practices are needed not only to expand access, but to make possible the continued improvement of networks, so users can take advantage of the opportunities they offer. Broadband networks may one day reach a level where they meet all existing and foreseeable demand, but there is little sign that this will occur in the near future, even as demand continues to evolve and technological capabilities progress. New generations of wireless networks, for example, are advancing apace or are planned in the most developed countries of the world (e.g. 4G and 5G) and, in a small number of places, fixed services are commercially available that are 40 000 times faster than initial broadband offers (i.e. 10 gigabits per second vs. 250 kbits per second). Ever since the introduction of broadband, a range of capabilities has been available across different locations, countries and regions, and stakeholders are caught up in an ongoing process of network development rather than aiming for a single end point.

Individuals, business and governments need the skills and capabilities to enjoy the dividends of broadband access and to benefit from it over time. More than half of the 15-year-olds in the LAC region have not acquired the basic level of competences to perform well in the labour market (OECD, 2016). The skills gap in basic competences, as well as in digital literacy, prevents many from participating fully in the digital economy, reducing their chances in the labour market and blunting competitiveness.

Broadband networks need not only to be accessible and affordable but also sustainable, so they can continue to stimulate and meet demand. Policies and practices are called for that address issues of supply and demand in a holistic, coherent manner across all sectors of society. The Broadband Policies for Latin America and the Caribbean: A Digital Economy Toolkit (thereafter: the Toolkit) is intended to provide good practices and case studies to help inform policy makers of regulatory practices and options to maximise the potential of broadband as a driver of social inclusion, productivity and good governance.

Broadband is crucial for socio-economic development

Following the rapid spread of broadband world wide, a large body of evidence has been amassed to support the effect this key digital technology has had on GDP growth (Czernich et al, 2009; Koutroumpis, 2009; Qiang, Rossotto and Kimura, 2009; IDB, 2012a), efficiency (Thompson and Garbacz, 2008), firm-level productivity (Bartel, Ichniowski and Shaw, 2007; Fornefeld, Delaunay and Elixmann, 2008), labour gains (de los Rios, 2010) and employment (Katz et al., 2009; Kolko, 2012). By reducing the costs of accessing information and expanding the channels of sharing knowledge, broadband is spurring productivity by creating new goods, services, business models and jobs.

A growing body of research shows that broadband also contributes to broader social development. It can help cultivate a more inclusive society and better governance arrangements, by improving the quality and coverage of public services and political participation and expanding the way that individuals collaborate, create content and benefit from a greater diversity and choice in products and from lower prices.

The role of broadband as an accelerator of development of information and communication technologies (ICTs) has been recognised globally. Its critical importance to the three pillars of development – economic development, social inclusion and environmental protection – was recently acknowledged by the United Nations (United Nations General Assembly, 2015). The task of making the Internet universal and affordable was approved as a target (Target 9.c) of the Sustainable Development Goals (SDGs), echoing the objective already elaborated by the UN Broadband Commission for Sustainable Development.1 Policies that explore the full potential of ICTs can accelerate progress towards the Sustainable Development Goals (SDGs). The table above summarises the ICT components set as targets in the SDGs and includes others that can potentially contribute (Table 1.1).

Table 1.1. Sustainable Development Goals (SDGs) and ICTs

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Target 1.4: By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services [. . .], appropriate new technology and financial services, including microfinance.”

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Target 9.c: Significantly increase access to information and communications technology and strive to provide universal and affordable access to the Internet in the least developed countries by 2020.

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Target 2.a: Increase investment [. . .] in rural infrastructure, agricultural research and extension services, technology development and plant and livestock gene banks [. . .].”

Target 2.c: Adopt measures to ensure the proper functioning of food commodity markets [. . .] and facilitate timely access to market information, including on food reserves, in order to help limit extreme food price volatility.

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ICTs, especially through mobile-based services, can help reduce inequality by drastically expanding access to information, contributing to individual empowerment and social inclusion of individuals who used to fall outside the reach of traditional services. (*)

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The use of ICTs in the health sector can result in higher quality health care that is safer and more responsive to patients’ needs. E-health can be particularly important in rural and remote areas, facilitating innovative models of care delivery, such as telemedicine and mobile health. (*)

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ICTs can be leveraged to organise cities and communities more efficiently. Smart cities use ICTs and big data to improve public service delivery and to advance broad policy outcomes such as energy savings, safety, urban mobility and sustainable development. (*)

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Target 4.b: By 2020, substantially expand globally the number of scholarships available to developing countries [. . .] for enrolment in higher education, including vocational training and information and communications technology, technical, engineering and scientific programmes, in developed countries and other developing countries.

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ICTs, and especially broadband, have directly connected consumers and producers and given rise to “on demand” markets of products that can be customised and localised, which can save time, reduce transport costs and contribute to more efficient and sustainable consumption. (*)

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Target 5.b: Enhance the use of enabling technology, in particular information and communications technology, to promote the empowerment of women.

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Use of the Internet of Things can help make monitoring the environment cheaper, faster and more convenient. (*)

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ICTs can contribute to improving water and energy access by using mobile solutions, smart grids and meters to advance efficiency, manage demand and develop new ways to expand access. (*)

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The use of ICTs in the public sector can improve the range and uptake of digital government services; strengthen the performance of public institutions and enhance transparency and the participation of all citizens. (*)

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Target 8.2: Achieve higher levels of economic productivity through diversification, technological upgrading and innovation.

Target 8.3: Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalisation and growth of micro-, small and medium-sized enterprises, including through access to financial services.

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Target 17.8: Fully operationalise the technology bank and science, technology and innovation capacity-building mechanism for least developed countries by 2017 and enhance the use of enabling technology, in particular information and communications technology.

Note: Not all SDGs had an ICT component officially included in a corresponding target by the UN. In those cases, identified by (*), examples were identified by the OECD to depict how ICT could contribute to that particular goal.

Sources: United Nations General Assembly (2015), “Transforming our world: the 2030 Agenda for Sustainable Development”, https://sustainabledevelopment.un.org/post2015/transformingourworld; OECD.

Broadband policy making

Despite the rapid spread of broadband, and the increasing agreement on the opportunities it brings, nearly 60% of the world’s population, or four billion people, are still offline. In the LAC region alone, it is estimated that around 300 million people do not have access to the Internet (ITU, 2015). These gaps in the availability and penetration of broadband persist, cutting a large portion of the population off from the digital dividends.

The task of closing the access and usage gaps is complex. It involves major supply-side challenges, notably encouraging investment and competition, extending broadband infrastructure into rural and remote areas and upgrading networks to match the rising demand. Additionally, demand-side issues, such as low levels of income, education and local content production, add new challenges of improving affordability and relevance of services to users.

As the challenges are often substantial and the stakes so high, the task of designing and implementing sound broadband policies is a critical one. Policy makers and regulators have at their disposal a large variety of tools that can be used to stimulate and encourage investment, competition and network deployment, and help make services more affordable, relevant, usable and safer for individuals and businesses.

Not all the challenges for extending broadband use can be addressed by policy makers and regulators alone. Broader structural challenges in the LAC region remain, such as lack of basic electricity and road infrastructure in remote areas. However, improved communication can also help address and potentially substitute for deficiencies in essential services. It can offer business models for off-the-grid energy availability (e.g. prepaid solar energy) and help overcome distance and transport barriers to the delivery of public services and the exchange of commerce. Successfully implemented broadband policies, formulated to improve social inclusion, productivity and governance can act as catalysts for expanding the digital dividends of broadband access and use throughout the whole economy and society.

Achieving these policy objectives will require a broader understanding of both supply-side and demand-side issues, articulated by a holistic and cross-sectorial policy approach. Experience shows that well-designed regulatory tools, ambitious digital strategies and broadband policies that expand the potential of individuals, business and governments can make a substantial difference in increasing broadband deployment, investment, competition and use.

This Toolkit aims to encourage the expansion of broadband networks and services in the region. It offers policy makers and regulators a tool for implementing policies based on a coherent and whole-of-government approach. This Toolkit covers a broad array of topics on broadband policy making, including digital strategies, regulatory frameworks, spectrum management, competition and infrastructure bottlenecks, broadband access, affordability, sector taxation, inclusion, convergence, regional integration, education, skills, business uptake, entrepreneurship, local content, e-health, digital government, consumer policy, and digital security and privacy. The layout of the Toolkit is shown in Figure 1.1.

Figure 1.1. Structure of the Broadband Policies for Latin America and the Caribbean: A Digital Economy Toolkit
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Each chapter of this Toolkit follows the same internal structure, providing the main policy objectives, guidance for the measurement of these objectives, an overview of developments in the region, and a compilation of good practices in each area.

The good practices presented here are not exhaustive and should be complemented by other available resources (Box 1.1). The OECD/Inter-American Development Bank (IDB) Toolkit offers some additional components that can be useful for policy makers and regulators in the region:

  • Good practices included in this Toolkit rely mainly on IDB’s experience in the LAC region, OECD recommendations and evidence-based analysis of broadband policy issues, as noted throughout each chapter.

  • The Toolkit draws on a wealth of information collected by the OECD/IDB team through an extensive questionnaire (with around 500 questions) sent to all 26 countries of the LAC region2 between 2014 and 2015, which addressed the different policy/regulatory issues covered in this Toolkit. This stocktaking exercise has provided an updated and comprehensive perspective of the region, and highlights good practices drawn from LAC countries.

  • Good practices from the OECD and LAC areas and evidence-based analysis have been applied to the specific condition of the LAC region, including the wide range of development levels in the region. This aspect has benefited from the advice of the IDB and LAC focal points, directly in these countries. Additionally, the OECD routinely reviews a number of LAC countries because they are OECD members (e.g. Mexico and Chile) or because they work closely with the OECD (e.g. Brazil, Colombia and Costa Rica).

  • Finally, this Toolkit covers supply and demand-side broadband policy issues (Figure 1.1). This includes policy topics related to infrastructure deployment, investment and competition, as well as ICT skills, employment, e-health, digital government, consumer protection, privacy and security. The aim is to offer a holistic overview that can help policy makers and regulators prepare for the future.

Box 1.1. This Toolkit and other ICT and broadband resources

This is not the first resource to address the digital economy. Other excellent resources available online can be used in conjunction with the present Toolkit. The OECD/IDB Toolkit does not aim to replace but to complement existing toolkits and regulatory references, drawing on extensive experience of policy making and regulation in different countries with different contexts and challenges.

The World Bank’s Broadband Strategies Handbook

The Broadband Strategies Handbook is a guide for policy makers, regulators and other relevant stakeholders on issues related to broadband development. It consists of seven chapters and two appendices that address broadband definitions, why broadband is important and how its development can be encouraged. The Handbook discusses the policies and strategies that government officials and others should consider when developing broadband plans, including the legal and regulatory issues, what technologies are used to provide broadband, how to facilitate universal broadband access, and how to generate demand for broadband services and applications.

Source: http://broadbandtoolkit.org/en/home.

ITU and InfoDev’s ICT Regulation Toolkit

The ICT Regulation Toolkit produced by the Information for Development Program (InfoDev) of the World Bank and the International Telecommunication Union (ITU) is a web-based tool for policy makers, regulators, industry and consumers providing a global overview of telecommunications policy and practical materials highlighting experience and results. Module 1 provides an overview of the Toolkit, while Modules 2-7 cover specific topics including competition and pricing, authorisation, universal access, spectrum management, legal and institutional frameworks and new technologies. The Toolkit also contains extensive practice notes and reference materials.

Source: http://www.ictregulationtoolkit.org/.

GSMA resources

The GSM Association, which represents the interests of mobile operators worldwide, has produced several resources to inform policy makers and regulators in mobile communication policies. These include the Mobile Policy Handbook (GSMA, 2016a) and the Competition Policy in the Digital Age Handbook (GSMA, 2015a), as well as specific work covering Latin American and Caribbean issues such as digital inclusion (GSMA, 2016b), content (GSMA, 2016c) and closing the coverage gap (GSMA, 2015b).

Source: GSMA.

The Latin American and Caribbean region

The Latin American and Caribbean region has made notable progress in economic and social development in recent years, enabling tens of millions of poorer households to join the global middle class. This process has taken advantage of external environment and policy innovations such as Brazil’s Bolsa Família and Mexico’s Oportunidades (OECD, 2016a). Nonetheless, the LAC region still lags behind more developed areas in terms of standards of living, levels of income inequality, share of the informal economy, education, investment, government accountability, infrastructure, productivity and connectivity. To understand broadband policy making in the LAC region, it is helpful to consider some of the structural challenges the region faces, as well as characteristics that may assist further development.

LAC is a large and diverse geographical region, encompassing 27 countries3 and more than 600 million people, and covering near 20 million square kilometres of forests, mountain ranges, glaciers, deserts, islands and urban centres. Despite the density of its urban areas, the average population of LAC in rural areas was 21%, a total of 122 million people in 2011 (Figure 1.2). The cost of connecting these populations, some of them in remote areas such as the Amazon forest, the Andes mountains or small islands in the Caribbean, is not negligible and must be taken into account when designing inclusive and ambitious broadband policies. At the same, time, the LAC area has particular characteristics that are potentially favourable to broadband development. It includes only two landlocked countries (the Plurinational State of Bolivia [hereafter “Bolivia”] and Paraguay), which offers easier access to submarine cables. Secondly, the widespread use of two languages, Spanish and Portuguese, is an advantage for communications, commerce and the development of content.

Figure 1.2. Proportion of urban and rural populations in LAC (2011)
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Sources: OECD for OECD countries; ITU (2015), ITU World Telecommunication/ICT Indicators Database, www.itu.int/en/ITU-D/Statistics/Pages/publications/wtid.aspx for LAC countries.

 https://doi.org/10.1787/888933354186

Between 2000 and 2014, average GDP growth in Latin America and the Caribbean was over 3% a year, and extreme poverty fell from 29% to 16% in 2013 (OECD, 2016). Notwithstanding these developments, income inequality in the LAC region (Figure 1.3) remains high compared not only to high-income countries (65% higher), but also compared to East Asian and sub-Saharan countries, (36% and 18% higher respectively) (UNDP, 2010).

Figure 1.3. Inequality income distribution in LAC (Gini coefficient)
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Note: LAC average is a population-weighted average. For Chile, the data used is for 2013, not 2012.

Sources: OECD (2016b), OECD Income Distribution Database, www.oecd.org/social/income-distribution-database.htm; IDB (2015), “Harmonized Household Surveys from Latin America and the Caribbean”, www.iadb.org/en/research-and-data//poverty,7526.html.

 https://doi.org/10.1787/888933354190

LAC countries continue to lag behind OECD countries in education outcomes. Despite improvements, school enrolment of both secondary and tertiary education and average school performance of 15-year-olds in LAC countries remain well below the OECD average (OECD, 2016). More than half of the 15-year-olds in LAC have not acquired the basic competences to perform well in the labour market, and only less than 2% of them are considered “top performers” in mathematics (the average is 13% in the OECD). Students’ outcomes are largely dependent on broader socio-economic backgrounds in LAC, and this skills gap results in a fundamental constraint for business development, innovation and inclusive growth in the region (OECD, 2013).

The skills gap in the LAC region has profound implications for the labour market. Individuals with fewer skills are often confined to low-productivity jobs, with lower earnings, longer hours, higher insecurity, poorer working conditions and limited access to training. While the lack of jobs is not the most pressing issue in most LAC countries, the proportion of the informal labour market and the low quality and productivity of jobs are major barriers for development.

Overall, the quantity and quality of infrastructure in LAC countries remain an impediment for raising productivity and social inclusion levels. Despite advances in the provision of basic access to services, such as water supply and electricity, the quality of roads, ports, public urban transport and communication infrastructures is still inadequate (OECD/CAF/ECLAC, 2015). The results of these structural challenges ultimately impact productivity, social inclusion and governance in the region. They also affect how the benefits of the digital economy can be distributed across the society.

In broadband access and use, although advances have been made, there is still a long way to go. Almost half of the population of LAC is not connected to the Internet, with 301 million people considered to be offline. Brazil, Mexico and Colombia together, given their size and population, jointly still need to connect around 180 million people, almost three times the population of France. In addition, this estimate does not yet classify the type or quality of Internet access. Of the 305 million connected people in the LAC, for example, only one-fifth, or 60.7 million, had fixed-broadband subscriptions (Figure 1.4).

Figure 1.4. An overview of the online and offline population in LAC
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Sources: Based on ITU (2015), ITU World Telecommunication/ICT Indicators Database, www.itu.int/en/ITU-D/Statistics/Pages/publications/wtid.aspx.

The numbers of mobile and fixed broadband subscriptions vary greatly among LAC countries. However, the regional averages remain much lower than OECD countries’. The LAC region has an average of 50% penetration for mobile broadband (i.e. SIM subscriptions per 100 inhabitants) and 10% of the population for fixed broadband for 2014, while OECD countries have 81% and 28%, respectively. Barbados, the country with the smallest area in the region, leads on both counts, while countries such as Peru, the Bahamas, Haiti, Paraguay, Nicaragua and Guyana lag behind (Figures 1.5 and 1.6).

Despite the relatively low penetration of broadband services, the high number of mobile telephone subscriptions in the region suggests that there is much untapped potential at least for mobile broadband services. The average for mobile telephone subscriptions per 100 inhabitants in the region is 116%, higher than the OECD average of 106%. The data also suggest that for reasons such as unequal coverage of mobile operators in national territories or high termination rates, individuals may choose to subscribe to two or more mobile telephone services (Figure 1.6).

Figure 1.5. Fixed broadband penetration in LAC (2013-14)
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Sources: OECD for OECD countries; ITU (2015), ITU World Telecommunication/ICT Indicators Database, www.itu.int/en/ITU-D/Statistics/Pages/publications/wtid.aspx for LAC countries.

 https://doi.org/10.1787/888933354205

Figure 1.6. Mobile broadband and telephone penetration in LAC (2014)
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Sources: OECD for OECD countries; ITU (2015), ITU World Telecommunication/ICT Indicators Database, www.itu.int/en/ITU-D/Statistics/Pages/publications/wtid.aspx for LAC countries.

 https://doi.org/10.1787/888933354212

A considerable effort is needed to connect more people in the LAC region. The task involves not only Internet service, but high-quality broadband services that help businesses, individuals and governments to become more efficient and innovative. This requires infrastructure, open and competitive markets, and demand stimulated by policies that tackle issues of affordability, entrepreneurship, skills and trust.

Main challenges

The key challenges for broadband access are to improve the availability of service, affordability, penetration and use. A number of inhibiting factors are particular to the LAC region, some of them mentioned above. They are related to either supply-side issues, such as infrastructure deployment and provision of broadband services, or to demand-side issues, such as skills, entrepreneurship, local content, consumer protection. More specifically, the main challenges for broadband policy making are:

  • There is a lack of incentives for infrastructure deployment. The LAC region has a daunting topography, with rainforest, deserts, mountain ranges, small islands and remote areas. The deployment of communication infrastructure is very expensive and in many cases, positive return on investment is unlikely. As is typical of such geographical areas, basic infrastructure, such as adequate roads or stable electricity grids, is lacking, which makes it challenging to install broadband infrastructure. Suburban areas too in many cities often lack basic infrastructure for telecommunications providers, and management of rights of way is frequently a major hindrance for network deployment and infrastructure co-investment.

  • Despite differences across the region, overall, competition in communication markets in LAC tends to be weaker than in OECD countries. This is often due to regulation that does not favour or actively discourages competition, incomplete liberalisation of telecommunications markets and, consequently, lower investment.

  • As is often the case elsewhere, regulatory frameworks in the LAC region are sometimes organised around separate “silos”, corresponding to what were traditionally distinct networks and services. Today, however, technologies and services are converging. The challenges this presents must be addressed with policy and regulatory frameworks that promote competition along the entire value chain, and that provide incentives and remove barriers for all players to innovate.

  • The lack of national, regional and international backbones is holding back the growing domestic and international traffic in the LAC region. Improving critical broadband infrastructure, including Internet Exchange Points (IXPs) is fundamental for ensuring that demand is met and that competition can lead to lower prices. Encouraging local content creation and exchange would increase the relevance of content, stimulating demand for broadband adoption.

  • The lower incomes of a large proportion of the LAC population make affordability of broadband services a major barrier for broadband use. Wide income inequalities exacerbate the situation, as low-income households tend to have a much lower income than the average. Moreover, sectoral over-taxation is an issue in some LAC countries.

  • Connecting schools with broadband is an unfinished task in the LAC region. Many schools in LAC countries are not connected to electricity. Connecting schools and training centres is essential if ICTs are to equip citizens for the digital economy.

  • The LAC lags behind other regions in the use of ICTs and broadband adoption in business. It also invests less in research and development (R&D) and other forms of innovation, which slows productivity, a major hurdle in LAC countries.

  • Encouraging more transparent, accountable, effective, and responsive governments is a key challenge in the LAC region. Progress has been made, but governments still need to improve overall public service delivery, participatory processes and accountability mechanisms. In general, LAC countries also need to promote adoption of whole-of-government approaches and a more effective culture of measurement and evaluation. Improvements in areas supported by broadband use could advance e-government and e-health initiatives, which would in turn support increased demand for broadband services.

  • Building trust is crucial to promote broadband use, but capacity levels vary in the LAC region for dealing with the evolving trust issues associated with broadband services. Consumer protection, privacy and digital security risk management are relatively novel topics in many LAC countries, and policy approaches are still being developed. This process could benefit from shared good practices.

Leading good practices

The main recommendations for broadband policy making in the LAC region are organised in the Toolkit in the Good Practices section included in each chapter. These are complemented by country cases that provide concrete examples of application and further reference for these good practices. In general, examples from LAC countries have been selected, but in some cases, experiences in OECD countries considered especially useful for LAC countries, have also been provided.

  • Overall, good practices focus on two key aspects: rolling out networks and supply of broadband services by private investors, complemented by the public sector when necessary, and encouraging demand for broadband by making it more affordable, relevant, usable and safer for individuals and businesses.

  • Public sector policies to increase broadband access and reduce use gaps should design digital strategies and national broadband plans using a whole-of-government approach. Built on collaboration with stakeholders and clear leadership, these should incorporate regular collection of data to evaluate progress and make any revisions necessary. Chapters 2 and 5 address these issues.

  • Encouraging investment to reduce infrastructure bottlenecks, by setting sound policy and regulatory incentives, should be a policy priority. A stable and predictable regulatory framework is needed to attract long-term investment in broadband infrastructure. Chapters 2, 3 and 4 of this Toolkit address these issues.

  • Lowering deployment costs to stimulate competition, as well as infrastructure investment and expansion, may require regulatory reforms. Facilitating access to rights of way and spectrum and incentivising the sharing of infrastructure, especially passive infrastructure, for example, can help expand broadband provision. Chapters 3 and 4 focus on these issues.

  • Competition is crucial for reducing prices, improving responsiveness to demand and ensuring innovation in broadband services. Independent and adequately funded regulatory agencies are needed to address, among other such issues, dominance. Wholesale regulation should be imposed when necessary to facilitate access to essential facilities and lower barriers for new entrants. Chapter 4 focuses on regulatory issues related to competition.

  • Expanding broadband access to disadvantaged groups and rural and remote areas is essential. Public authorities can establish incentives and finance national backbone networks, when markets are unable to meet demand. Chapter 5 explores mechanisms for expanding broadband access.

  • Making broadband services affordable and accessible is vital for maximising the benefits of the digital economy. To increase investment and competition, policy makers should avoid sectoral over-taxation in telecommunications services, especially for broadband. High government charges on telecommunications services or on importing telecommunications equipment and handsets can deter broadband expansion and use, affecting individuals, businesses and governments. Chapter 6 further explores questions of taxation, affordability and inclusion.

  • Policy makers and regulators should prepare for the convergence of networks and services. This, and new offerings, have already presented challenges in the LAC region. Regulatory frameworks should ensure that independent regulatory authorities are well positioned for the growing converged landscape, providing adequate powers and scope of regulatory authority to address competition and investment over the full value chain of converged services. Chapter 7 addresses some of the emerging issues involving convergence.

  • Regional co-ordination can help implement policies that encourage economies of scale, investment and competition. LAC policy makers and regulators should encourage sharing of regulatory experiences, deployment of regional connectivity infrastructures, cross-border data flows and lowering the prices of international connectivity and roaming. Regional co-operation arrangements and national regulatory frameworks need to facilitate existing transborder services and should be prepared for the demands of emerging cross-border services, for example, the Internet of Things (IoT). Chapter 8 addresses regional integration and cross-border issues.

  • Promoting a skills system geared to the digital economy can help increase interaction between broadband use, labour markets, productivity, innovation and inclusive economic growth. Most importantly, it is crucial to ensure the availability of broadband services in schools, training and community access centres, and other places of public access that can provide a platform for digital skills. Chapter 9 addresses these skills and jobs issues for the digital economy.

  • Increasing ICT adoption by businesses and digital entrepreneurship is essential to encourage companies to scale up quickly and compete with other firms, both nationally and globally. Digital entrepreneurship should be encouraged by strengthening entrepreneurial access to digital services, reviewing regulatory barriers to setting up new businesses and promoting e-commerce. The creation of digital content, including local content, should be promoted to increase demand. Chapter 10 discusses issues of ICT adoption in businesses, digital entrepreneurship and content.

  • Policy makers should use ICTs to improve access to and improve the quality of health care. This can contribute significantly to efficiency gains and cost reduction in the health sector. They can also improve performance, expanding access through tele-health, advancing data sharing and monitoring, and contributing to better diagnostics and treatment. Chapter 11 analyses how to enhance e-health initiatives.

  • ICTs can enhance governments. New digital technologies (e.g. social media platforms, smartphones) and new approaches to using technology (e.g. open government data and “big data”) offer new, more collaborative ways of working within and across administrations, and better ways to engage with the public and promote the smarter organisation of cities. Governments can become not only more efficient and effective, but also more open, transparent and accountable to citizens. Chapter 12 addresses ways to encourage digital governments.

  • Enhancing trust in digital services encourages uptake by individuals, business and governments. Consumer protection and education not only helps consumers make more informed choices, but drives and sustains a competitive market. Managing digital security risks and protecting privacy and personal data, in policy frameworks based on multi-stakeholder collaboration, promotes a safer, more robust digital ecosystem. Chapters 13, 14 and 15 address consumer protection, digital risk management and privacy.

  • Finally, implementing systematic measurement frameworks on broadband and digital services is central for informing policy and regulatory decisions. Data should be collected from market players and consumers, and impact assessments prepared from open, transparent processes that give all stakeholders the opportunity to provide feedback. The need for effective measurement is addressed in each chapter of this Toolkit.

References

Bartel, A., C. Ichniowski and K. Shaw (2007), “How Does Information Technology Affect Productivity? Plant-Level Comparisons of Product Innovation, Process Improvement, and Worker Skills”, The Quarterly Journal of Economics, Vol. 122, No. 4, pp. 1 721-1 758.

Czernich, N. et al. (2009), “Broadband Infrastructure and Economic Growth”, CESifo Working Paper 2861, Center for Economic Studies and Ifo Institute, Leibniz Universität, Hannover, Germany.

De los Rios, C. (2010), Welfare Impact of Internet Use on Peruvian Households, Instituto de Estudios Peruanos, Lima.

Fornefeld, M., G. Delaunay and D. Elixmann (2008), “The Impact of Broadband on Productivity and Growth”, Micus Management Consulting, European Commission, Brussels.

GSMA (2016a), Mobile Policy Handbook, http://mph.gsma.com/publicpolicy/handbook.

GSMA (2016b), Digital Inclusion in Latin America and the Caribbean, https://gsmaintelligence.com/research/2016/02/digital-inclusion-in-latin-america-and-the-caribbean/542/.

GSMA (2016c), Content in Latin America: Shift to Local, Shift to Mobile, https://gsmaintelligence.com/research/2016/02/content-in-latin-america-shift-to-local-shift-to-mobile/537/.

IDB (2012), Socioeconomic Impact of Broadband in Latin America and Caribbean Countries, Inter-American Development Bank, Washington DC, www10.iadb.org/intal/intalcdi/PE/2013/11427.pdf.

IDB (2015), “Harmonized Household Surveys from Latin America and the Caribbean”, Sociometro Database, Inter-American Development Bank, www.iadb.org/en/research-and-data//poverty,7526.html.

ITU (2015), ITU World Telecommunication/ICT Indicators Database, www.itu.int/en/ITU-D/Statistics/Pages/publications/wtid.aspx.

Katz, R. et al. (2009), “The Impact of Broadband on Jobs and the German Economy”, Columbia Institute for Tele-Information Working Paper.

Kolko, J. (2012), “Broadband and Local Growth”, Journal of Urban Economics, Vol. 71. No. 1, pp. 100-113.

Koutroumpis, P. (2009), “The Economic Impact of Broadband on Growth: A Simultaneous Approach.” Telecommunications Policy, Vol. 33, No. 9, pp. 471-485.

OECD (2016a), “Promoting Productivity for Inclusive Growth in Latin America”, Better Policies Series, OECD Publishing, Paris, www.oecd.org/latin-america/promoting-productivity-for-inclusive-growth-in-latin-america.pdf.

OECD (2016b), OECD Income Distribution Database, www.oecd.org/social/income-distribution-database.htm.

OECD (2013), PISA 2012 Results: Excellence Through Equity (Volume II): Giving Every Student the Chance to Succeed, Programme for International Student Asssessment, OECD Publishing, Paris, https://doi.org/10.1787/9789264201132-en.

OECD/CAF/ECLAC (2015), Latin American Economic Outlook 2016: Towards a New Partnership with China, OECD Publishing, Paris, https://doi.org/10.1787/9789264246218-en.

Qiang, C., C. Rossotto and K. Kimura (2009), “Economic Impacts of Broadband”, Information and Communications for Development 2009: Extending Reach and Increasing Impact, World Bank, Washington DC, http://siteresources.worldbank.org/EXTIC4D/Resources/IC4D_Broadband_35_50.pdf.

Thompson, Herbert G. and Christopher Garbacz (2008a), “Broadband impact on state GDP,” working paper, www.itu.int/net/wsis/stocktaking/docs/activities/1287145862/Ohio_University.pdf.

UNCTAD (2011), Measuring the Impacts of Information and Communication Technology for Development, United Nations Conference for Trade and Development, New York and Geneva, http://unctad.org/en/Docs/dtlstict2011d1_en.pdf.

UNDP (2010), Latin America and the Caribbean Human Development Report 2010, United Nations Development Programme, New York, www.undp.org/content/undp/en/home/librarypage/hdr/latin_america_andthecaribbeanhumandevelopmentreport2010.html.

United Nations General Assembly (2015), “Transforming our world: the 2030 Agenda for Sustainable Development”, Resolution Adopted by the General Assembly on 25 September 2015, United Nations, New York, https://sustainabledevelopment.un.org/post2015/transformingourworld.

Further reading

AHCIET (2014), Latin America Challenge 2020: Investments to Bridge the Digital Divide, Asociación Iberoamericana de Centros de Investigación y Empresas de Telecomunicaciones, Grupo Convergencia, Buenos Aires, Argentina, www.cet.la/download/8/.

CAF (2014), Hacia la Transformación Digital de América Latina, Corporación Andina de Fomento, Caracas, Venezuela, http://publicaciones.caf.com/media/39809/informe_tecnologiacaf.pdf.

CAF (2013), La Infraestructura en el Desarrollo Integral de América Latina, CAF, Corporación Andina de Fomento, Caracas, Venezuela, www.caf.com/_custom/static/ideal_2013/assets/book_1.pdf.

CEPAL (2015), The New Digital Revolution: From the Consumer Internet to the Industrial Internet, United Nations, Santiago, Chile, http://repositorio.cepal.org/bitstream/handle/11362/38767/S1500587_en.pdf?sequence=1.

CEPAL (2013), The Digital Economy for Structural Change and Equality, United Nations, Santiago, Chile, http://repositorio.cepal.org/bitstream/handle/11362/35954/S2013350_en.pdf?sequence=1.

GSMA (2014), The Mobile Economy Latin America, GSM Association, London, www.gsmamobileeconomylatinamerica.com/GSMA_Mobile_Economy_LatinAmerica_2014.pdf.

GSMA (2013), Mobile Broadband at the Bottom of the Pyramid in Latin America, GSM Association, London, http://gsma.com/newsroom/wp-content/uploads/2013/12/GSMA_LatAM_BOP_2013.pdf.

IDB (2012), Bridging Gaps Building Opportunity: Broadband as a Catalyst of Economic Growth and Social Progress, Inter-American Development Bank,Washington DC, https://publications.iadb.org/handle/11319/5475?locale-attribute=en.

ITU (2012a), Progress Report on Telecommunication: ICTs in the Americas Region, International Telecommunication Union, Geneva, http://gsma.com/newsroom/wp-content/uploads/2013/12/GSMA_LatAM_BOP_2013.pdf.

ITU (2012b), The Impact of Broadband on the Economy, International Telecommunication Union, Geneva, https://www.itu.int/ITU-D/treg/broadband/ITU-BB-Reports_Impact-of-Broadband-on-the-Economy.pdf.

Notes

← 1. The Broadband Commission for Sustainable Development was established in May 2010 by the International Telecommunication Union (ITU) and the United Nations Educational, Scientific and Cultural Organization (UNESCO). The Broadband Commission unites industry executives, government leaders, policy experts and international organisations to promote the rollout of broadband and development. To date, the commission has published a number of high-level policy reports, best practices and case studies. See http://broadbandcommission.org/.

← 2. They include the 26 member countries of the IDB (Argentina, Bahamas, Barbados, Belize, Bolivia, Brazil, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, El Salvador, Guatemala, Guyana, Haiti, Honduras, Jamaica, Mexico, Nicaragua, Panama, Paraguay, Peru, Suriname, Trinidad and Tobago, Uruguay and Venezuela).

← 3. They include the 26 LAC members of the IDB and Cuba.