The Secretary of Modernization, Andrés Ibarra, made the announcement to dozens of small operators and telecommunications cooperatives. What impact would there be
ARSAT will freeze the price of its wholesale internet rate in pesos until January 31, 2020 at $ 447 per mega. Then, the price will be updated according to the Consumer Price Index month by month from February next year. The decision responded to a request that the smallest internet providers had raised in the face of the devaluation of connectivity costs.
This was announced by the Deputy Chief of Cabinet and Secretary of Modernization, Andrés Ibarra, during a conference he gave at the Benavídez Earth Station, where the operations of the satellite company are concentrated, as anticipated Professional in this article.
In this way, the cost of wholesale internet mb is around US $ 7.7, which represents a reduction on the last official announcement of the Government, made in November last year, when it took that value to US $ $ s10.
However, some providers that group the acquisition of mb for many internet operators, in the style of a shopping pool, for several months already managed to negotiate that value between US $ 6 and US $ 7. Of course, that price was not the one that the ISPs who came to the home then received.
And that is, along with pesification, the main difference now. All internet providers that buy from ARSAT will pay that price. The expectation is that this move made by the state company has its impact on the rest of the carriers with the capacity to sell wholesale internet.
From 2016 until now, the company came reducing the cost of this input while establishing a flat rate for the entire country. On each occasion that reduction was repeated in the rest of the companies in the sector, as the same internet companies admit, which, in turn, value, especially when it comes to smaller providers. ARSAT is, in this sense, a market regulator.
"In the framework of the current economic situation, in response to our commitment and our responsibility to care for Argentines and bring tranquility to SMEs, we believe that what we are announcing today is in line with that objective of accompanying with certainty, providing concrete solutions to each of the sectors, as is the case in telecommunications, "said Ibarra.
With this tariff scheme, the ISPs will be able to improve the quality of the service, basically from the speed, without having to apply increases to the rates, beyond the devaluation. Another objective that is pursued is that these companies can continue promoting their deployments of new networks in their areas of influence.
"Whenever there is a reduction in price, the industry will be happy. ISPs need predictability, knowing how much they will pay, and if they can fit better. Except for labor, the rest of the costs are dollarized. I don't think that many carriers they can do that pesification, except ARSAT that receives funds from the SU to self-supply. The others do not receive them, they pay them, "Ariel Graizer, president of the Internet Chamber of Companies (CABASE), who has just turned 30, told iProfessional.
For the manager "the values that ARSAT had were expensive. With this, they may be more on the line", although he also warned that there is another cost to calculate. It happens that the state company does not deliver the capacity in the node of the internet provider but in theirs. Therefore, the provider has to go looking for it and that also represents a cost.
"You have to do those exercises to know how it affects the price of others and each internet provider," he said.
In that sense, he said it is not so easy for an ISP to change carriers. Migrations require time, and it is usually more common to add a carrier rather than replace it. Anyway, Graizer said that "maybe what ARSAT achieves is selling a little more because it has a small market share, really very small."
ARSAT today has a network of more than 30,000 kilometers of illuminated fiber through which it provides wholesale internet. More than 600 SMEs and ICT cooperatives market the service, according to official information.
Ibarra took advantage of the announcement to assert that the average fixed internet speed in the country is 20.4 mb, an objective that this Government had intended to achieve by the end of this 2019. He stressed that this speed quadrupled from 4.4 mbps of end of 2015 to what is registered now.
He also said that during this period the amount of internet access in homes increased by 2 million, reaching 8.9 million connected homes in the second quarter of this year.
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