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Tuesday, 22 June 2021

Peru wants more 4G and Open RAN

Peru is the third largest country in South America, after Brazil and Argentina. It's roughly over three times the size of Japan or Germany or five times as large as UK. Having said that, its population is just over 33 million. It is made up of a variety of landscapes, from mountains and beaches to deserts and rain forests. Most people live along the coast of the Pacific Ocean, where the capital, Lima, is located.

Peru’s fixed-line teledensity remains among the lowest in South America, with obstacles to fixed-line growth including widespread poverty, fixed-to-mobile substitution, expensive telephone services, and geographical inaccessibility in the rugged Andean mountains and lowland Amazon jungles. The government is addressing these shortcomings via ambitious investment plans to deploy telecom infrastructure and services in underserved areas. Most of the work was complete by the end of 2017, when eight regional fibre-based networks were connected to the National Fibre-Optic Backbone.

Broadband penetration in Peru is considerably lower than the Latin American average, despite government efforts to encourage the development of the sector.

Mobile penetration is on a par with the regional average, though high penetration is attributed to the popular use (especially among urban dwellers) of multiple mobile subscriptions. This phenomenon is becoming less pronounced as network operators respond to market competition by providing generous data and voice bundles (so obviating the need for SIM cards from different networks) and as the regulator endeavours to remove illegal devices and unregistered SIM cards from the market.

Telefónica Perú (trading as Movistar Perú) is the leading player in the mobile market, followed by Claro Perú, Entel Perú and Viettel (trading as Bitel). The market still has considerable potential to expand, especially given the country’s low fixed broadband penetration which has encouraged the uptake of mobile data services. By late 2020, the mobile broadband penetration rate reached 69% of the population.

2G/GSM and 3G/UMTS are on 850 and 1900 MHz on the three major operators Movistar, Claro and Entel. 4G/LTE has started in 2014 in major cities on AWS frequency 1700/2100 MHz on Movistar and Entel and 1900 MHz on Claro and is already open for prepaid. Soon on all three operators the 700 MHz frequency (Band 28) will be added. Bitel has a limited 3G network so far on 900 and 1900 MHz and launched 4G/LTE on 900 MHz (Band 8).

In the most recent OpenSignal report Entel was the dominant operator as far as the awards table was concerned, winning three out of seven awards outright and jointly winning another three. This time round, both it and Movistar each hold two awards outright and two jointly. However, Entel remains the operator with the best scores for our two speed metrics — Download Speed Experience and Upload Speed Experience. Neither operator has been able to challenge Claro’s grip on the 4G Coverage Experience award.

Also, Bitel users’ mobile experience has improved very significantly since the previous report, with impressive gains seen across Video Experience, Download Speed Experience, Upload Speed Experience and 4G Availability. With the exception of 4G Availability, much of the improvement made up for the lost ground seen back in the August 2020 report, when many scores dropped significantly due to the headwinds created by the COVID-19 pandemic. However, Bitel’s scores in this report for Video Experience, Download Speed Experience and Upload Speed Experience have risen more strongly than other operators and are up by 6 points (15.1%), 1 Mbps (23.8%) and 0.6 Mbps (30.5%) respectively from the scores in Opensignal’s February 2020 report.

Although operators are yet to launch commercial 5G services for smartphone users and the auctioning of spectrum in the 3.5 GHz and 26 GHz bands will not take place until 3Q 2021, there have still been a number of interesting developments in the Peruvian mobile market since the last report. These include the news that the country’s Ministry of Transport and Communications (MTC) is seeking to invest around $413 million to bring 4G connectivity to more than 2,600 communities. In addition, MTC has also published draft network sharing regulations that it believes will cut the cost of network rollout and make it easier to serve rural areas.

Movistar in Peru, owned by Spanish Telefónica, is the biggest provider and market leader in the country. It has more than 1/2 of all mobile customers and the best coverage (coverage map). But this comes at the highest prices. Also, you should keep in mind when you are travelling overland between major cities many hours without any signal are common.

4G/LTE has started in 2014 on the AWS frequency of 1700/2100 MHz (band 4) and added 700 MHz (band 28) which is open to all prepaid tariffs. Movistar guarantees speeds of 5-130 kbps on 2G, 0.4-1 Mbps on 3G and 2-5 Mbps on 4G/LTE. They use carrier aggregation of both LTE bands in the capital for the highest speeds.

Claro is the big rival of Movistar in Peru. It has more than 1/3 of all mobile customers and only a slightly lower coverage at lower prices.

4G/LTE has started in major cities and is available on all prepaid plans. Unlike its competitors, Claro uses the 1900 MHz (band 2) frequency for it, which is more accessible to many devices from out of the US. In 2016/7 it added the 700 MHz (band 28) in Lima and 38 more towns for LTE. In and around Lima they have added support for 2600 MHz (band 7) 4G+ is available using both bands.

Their LTE coverage is on par and partly surpasses that of Movistar, if you don't have a device that carries band 4. However, you should keep in mind when you are travelling overland between major cities many hours without any signal are common.

As in many other countries, the incumbent operator Movistar offers the best coverage, but at higher rates. Claro as challenger has a heavy marketing footprint all over the country, while Movistar is less visible. Despite that, where there is Claro, there is always Movistar too. Either next door (literally) or in the same Claro-colored small shop/street vendor.

This operator has launched commercial fixed-wireless broadband services via 5G technology, having received authorisation from the telecom ministry to use its existing 3.5GHz spectrum for the service earlier this year.

The Chilean market leader Entel bought Peruvian network Nextel in 2013 and changed its name to Entel in 2014. It's still building up its network and lacks the coverage of the big two providers, but can be reasonable if you stick to the cities. Please note however coverage is very limited in the Loreto Department (Amazonas region). There is no (zero) siginal when travelling by boat between Yurimaguas and Iquitos.

4G/LTE has started in 2014 in Lima on the 1700 MHz AWS (B4) frequency and spread out to more places. According to OpenSignal's country report compiled in 2019, it's the best 4G/LTE network in the country what speed is concerned and matches Movistar's coverage of 85% covered by 4G networks.

This operator as also launched a fixed-wireless broadband service utilising 5G technology on the 3.5GHz band. Both Entel and  Claro, were granted permission by the Ministry of Transport and Communications (Ministerio de Transportes y Comunicaciones, MTC) to utilise its existing frequencies in the band to offer a fixed-wireless internet service using 5G New Radio (NR) technology. Entel’s 5G plan provides downlink speeds of up to 50Mbps for PEN150 (USD40.13) per month, plus an up-front fee of PEN1,499 for the modem and installation.

 

Bitel is the latest arrival in Peru. They are the Latin American branch of Vietnamese army-owned Viettel and started in 2014 with an own network in the country. It's in a rather limited area (see coverage map) on 900 MHz and 1900 MHz. The rather unusal 900 MHz spectrum is used for 3G, added by 1900 MHz. In 2016 Bitel launched its 4G/LTE network through 1,750 4G base stations, covering 500 population centres on the rather unusual band 8 (900 MHz). It has a wide 4G coverage in Peru now, but focuses on rural areas which are not covered by other operators. So it's only recommended if you go to these places. In an OpenSignal test in 2019 speeds were much lower than on the other three networks.

Back in 2018, Telefónica announced “Internet para todos” (“Internet for all”), a collaborative project to connect the unconnected in Latin America. The Initiative is aimed at connecting the more than 100 million people in Latin America with no internet access. Telefónica agreed collaboration with Facebook on key technological and commercial innovations and collaboration with multiple stakeholders: rural operators, technology firms and regulators.

Parallel Wireless have been deploying OpenRAN sites with them and even did a press release last year to say hundreds of sites have been deployed.

Last month Telefónica announced that 'Internet Para Todos' is two years old and has contributed to connecting more than 2 million Peruvians in rural areas with 4G internet. Internet para Todos expects to close 2021 with 13,000 communities with high-speed mobile internet access.

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