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Luis Benatuil, CEO of Movistar: ‘Contract renewal, great opportunity for the country to accelerate its digitization’

Luis Benatuil, CEO of Movistar: ‘Contract renewal, great opportunity for the country to accelerate its digitization’

The president of Telefónica Movistar Ecuador explains the progress of the negotiation of the new spectrum concession contract that has been initiated with the country

Luis Benatuil is the brand new CEO (president) of Telefónica Movistar Ecuador. In an interview with Diario EL UNIVERSO, this executive, who has an MBA from the University of London and a master’s degree in Telecommunications from the Polytechnic University of Catalonia, gave an overview of how the negotiations for the new concession contract to be signed with the Ecuador and that started in August. He also spoke of the importance of connectivity both in the pandemic and post-pandemic scenarios.

What is the mission that you now have at the helm of Telefónica Ecuador?

Telefónica’s mission is to continue being a digital ally of Ecuador; We have been in Ecuador since 2004 and we want connectivity and digitization to continue growing in the country. One of the most important points in the coming months and years is the process of renewing the telephony concession contract. This will last 20 years and reconfirms Telefónica’s commitment to the country.

What are the progress of these negotiations?

On August 25, the Telecommunications Regulation and Control Agency (Arcotel) notified the start of the negotiations. And from there you have a period of 90 business days to issue the draft contract in order to start the negotiation process, which could take up to two years. The Arcotel has said that it will hire an international consultancy to support the valuation process and will have an international observer for the entire negotiation process. Both aspects seem to us to be the right decisions for the transparency of such an important process. On November 30, 2023, the Otecel concession ends.

How are telecommunications in Ecuador, that is, what is the standard compared to other countries?

Ecuador is in an average state. Although it is true that connectivity developed well in the country, during the pandemic it became clear that connectivity is still a privilege and that more rural areas of the country need to be connected. In fact, one of the pillars that the Government is promoting is that connectivity must be improved in rural areas. This is not just a telecommunications issue but also a social one, since a connected population is much more productive and will generate more development. In terms of figures, according to the CAF study Status of the digitization of Latin America in the face of the pandemic, You can, for example, see that Ecuador has 69.09% internet penetration, compared to 76.47% in Colombia and 61.08% in Peru; while the regional average is 78.78% penetration.

How did you see the performance of connectivity services in the pandemic, what are the lessons?

The pandemic came to show categorically that connectivity has played an essential role for Ecuador to continue functioning. Hand in hand with the health and food sectors, connectivity was one of the great heroes of this pandemic. Additionally, connectivity after the pandemic will continue to be very important, so that people continue to telecommute and be teleconnected. Telecommunications are a tool to promote social equity and productivity. But the figures show a decrease in speed and bandwidth due to the increased traffic in a pandemic. According to the same CAF study, in Chile it was (-3%) and Ecuador (-19.6%), combining this with an increase in latency (time that information comes and goes) in the same technology in Brazil ( 11.7%), Chile (19.0%), Ecuador (11.8%) and Mexico (7.4%).

Regarding the contract that is being negotiated, what are your expectations about it? And how to make rates better for customers?

The renewal of the contract is a great opportunity for the country to accelerate its digitization. It is very important that the contract safeguards all the actors of the digital ecosystem: State, companies, corporate consumers, massive clients. The idea is that it has adequate conditions for the promotion of investments and the development of the sector. Regarding the rates, it would be expected that there will be a review of the costs of using the spectrum, which are the ones that make the rates more expensive, since the cost being lower, the consumer rate can be reduced.

Do you consider that there is the possibility of other operators entering and how would you see the entry of more competitors?

The market is always open to receive more players, but this also has to do with the size of the market. Here we are Conecel, Otecel (with our brands Movistar and Tuenti) and CNT.

One topic that is new and arousing curiosity is 5G technology. What is it and when will it arrive in the country?

The fifth mobile generation will represent the natural evolution of 4G. You have to remember that we had an analog technology, then 2G, 3G came. In Ecuador we still have 2G, 3G and 4G in various sectors. 5G technology has the ability to enable hyperconnectivity services, for example in the home, and will be a contribution to digital education and health. It offers connections with higher data transfer, with higher bandwidth and lower latency.

Would the new contract to be signed establish that this new technology would already arrive in Ecuador or is it still early for the country?

I believe that 5G could begin to arrive after the new agreement. The renewal will surely include agreements, what will be needed for 5G. More spectrum is required, more fiber optic. It is necessary to mature the entire transport layer and have all the cells interconnected for the arrival of 5G. Another topic, and no less, are the devices or terminals (smartphones), which are very expensive. We have to wait for the market to mature and for the average price to begin to drop in order to make it accessible to the population. It must also grow in capillary antennas and that they are fibrated (with fiber optics). We are on the path of maturing in this process. There must be a lot of sharing and infrastructure.

It has been known that within the telephone they have implemented interesting labor policies, can you tell us what these are?

The company cares about human talent, we are the second company in Ecuador to have obtained an “F” certification, family-friendly. Apart from the economic benefits, Friday afternoons are free. Now we are returning to work but we do it three days a week in person and two days home office. On October 29 we will be holding a work day to bring the pet to the office.

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