Monday, February 09, 2009

Cuba Justifies Low Use And High Cost Of Mobiles

Cuba Justifies Low Use And High Cost Of Mobiles
Cuban cell phone density is rated by the United Nations as the worst in
Latin America and fixed-line density the sixth lowest.
Published: February 08, 2009 20:36h

Mobile telephone use will remain limited and costly in Communist-run
Cuba for the foreseeable future due to the need to subsidize their
social use and ensure communications with isolated areas, a state-run
newspaper said on Sunday.

The Juventud Rebelde (Young Rebel) newspaper quoted phone company Vice
President Maximo Lafuente as stating there were 480,000 mobile phones in
the communist-run country of 11.2 million people, of which the 30
percent priced in Cuban pesos accounted for 80 percent of the traffic
and the 70 percent priced in hard currency accounted for 20 percent of

"The vast majority of cell phone traffic is subsidized by the state
thanks to the income from cell phones functioning in convertible
currency," the newspaper said.

Juventud Rebelde said peso priced mobile phones are largely assigned to
health, education, security and state administrative personnel, as well
as to institutions and homes in isolated areas of the country.

"Lines assigned for social reasons account for just 30 percent of those
in use, but account for almost 80 percent of the traffic," Lafuente said.

"For this reason and to avoid congestion not only do we have to
constantly invest to increase coverage, but have to limit the minutes
assigned to social uses," he added.

The paper also blamed U.S. sanctions for the situation.

The same newspaper on Saturday reported there were no immediate plans to
open up Internet access to the general public, but reported there were
more than a million users in the country largely through institutions,
though it was not clear how many only had access to the government intranet.

Cuba's failure to quickly adopt to modern communications technology at a
reasonable price is a major complaint among citizens under 50 years of
age and especially the youth.

Cuban telecommunications monopoly ETECSA is a joint venture in which
Telecom Italia has a 27 percent stake.

Cuba has less than one fixed line telephone per 10 inhabitants and has
slowly been adopting cell phones as a less expensive alternative in
terms of state investment.

Cuban cell phone density is rated by the United Nations as the worst in
Latin America and fixed-line density the sixth lowest.

Cubans are free to buy and use cell phones in a hard currency equivalent
called convertible pesos at an exchange rate of 24 pesos to the
convertible peso or CUC.

The state dominates the economy and the average state wage is around 420
pesos, or 18 convertible pesos, per month.

At the same time some 60 percent of the population has some access to
hard currency through money sent them by relatives abroad, tourism tips
and state bonuses.

A cellular telephone line costs 60 CUCs and the cheapest cellular phone
is priced at 60 CUCs.

A minutes use of a cell phone calling out or receiving averages half a
CUC or more than half a days state wages, while an up to 160 character
text message costs .16 CUC to send.

New technologies to receive and send e-mail, access Internet and receive
and send graphics do not exist.

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