GSMA, the global trade group of mobile network operators, has warned that spectrum pricing policies in Latin American countries could affect the quality of cell phone services, accusing regulators of artificially inflating the prices of radio waves.
The lobby group, which claims to have studied trends in 15 countries across the region, has not named any country specifically but has harshly criticized Latin governments, saying they were ‘driving up spectrum costs for short-term gain’.
Considering its study, spectrum prices in Latin America are almost twice as high as in Europe, and the amount of spectrum allocated to mobile operators is much lower than in Asia, Europe, or North America.
Despite high prices, operators have continued to purchase spectrum as it is inevitable for them to remain competitive.
But the expensive spectrum, according to the trade body, is putting serious financial pressure on the industry, impacting the delivery of next-generation networks.
In developed countries, demand for services and competition among market forces sets the spectrum price. But in Latin America, says GSMA, high prices are ‘largely due to policy decisions’.
“Latin American countries that do not make spectrum available for 4G and 5G networks and artificially inflate the price are holding back their digital economies, not closing the digital divide, and hurting consumers,” said Sebastian Cabello, Head of Latin America, GSMA.
“Consumer demand for mobile data services continues to grow, but unless governments and regulators manage spectrum efficiently and make the process more transparent, affordable, and achievable for operators, costs will not decrease sufficiently and consumers will not see the benefits.”