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Wednesday, April 14, 2004


Ecuador: Transelectric's 1000 km fiber network is transforming the economy

Matt Cowely has a long article in Business News America about Ecuadorian power utility Transelectric's role in transformation of Ecuador's telecommunications industry:
"Ecuador's carrier-of-carriers Transelectric expects to complete construction of a 1,000 km national fiber-optic backbone along its electric power transmission network in mid-2005, Transelectric telecoms manager Roberto Proanio told BNamericas. The coastal stretch is costing some US $4 million to install, which is about one quarter of the normal cost of installing a fiber optic link, as Transelectric saves money by using the transmission towers already in place, and avoids having to pay any rights-of-way."

"The fiber link will be the first national backbone in Ecuador, he said, as the only existing fiber link runs purely between capital city Quito and the second city Guayaquil, and is owned by state telco Andinatel. The rest of the country is connected by microwave or satellite links, he said, adding that the company is keen to ensure fair access for all operators to the network."

"Transelectric is already in talks with some 70 potential customers, including telecoms operators and large corporations, he said, adding the company has no plans to provide anything other than carrier-of-carrier services."

"The company's first incursion in the telecoms carrier business was the international fiber link to Colombia, in partnership with Internexa, the telecoms unit of Colombian transmission company ISA. The link was inaugurated in August 2003 and provides links from Quito through Colombia to Cartagena and then to the ARCOS submarine cable. Through the link, Transelectric has Tier 1 access to the NAP of the Americas network access point in Miami."

"The international link has had a dramatic impact on wholesale prices in Ecuador, which have fallen from around US$30,000 for an E1 connection several years ago to US$14,000 when the line was inaugurated and US$4,000 today, Proanio said. All Ecuador's main telecoms companies are using the international link, including Argentine carrier Impsat and local cable television operators, amongst others, he said."

ENTRESA, the Nicaraguan national power transmission company, has an almost identical project underway (see previous posts: April 9, April 12). It will be interesting to see how ENTRESA's project shapes the Nicaraguan economy.


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