A new Paraguayan policy aimed at preventing telecommunication rate increases and improving citizens' access to technology through the development of 5G is drawing attention. The Paraguayan Telecommunications Commission (Conatel) recently announced that its 5G frequency auction was designed for a 'non-profit' purpose. This is a departure from the past 4G auction, and is seen as the government's intention to curb telecom rate increases and encourage private investment.
In an interview with Radio Ñandutí, Víctor Martínez, Conatel's acting director, emphasized, "The government has decided to prioritize building a 5G network across Paraguay rather than generating revenue through this 5G auction." This is a clear contrast to the 4G auction, which contributed to the national treasury.
Preventing Rate Hikes and Promoting Investment
Martínez stated that Conatel was aware that the low profitability of 5G deployment would make telecommunications companies reluctant to invest in networks, and that rate increases would be inevitable if investments were made. To solve this problem, Conatel decided not to impose high licensing fees. This allows telecom companies to directly invest the saved costs in infrastructure development. This policy is expected to stimulate the digital economy and ultimately reduce the financial burden of communication fees on the public.
Strengthening Security and Technical Challenges
Martínez warned of the security threats that 5G technology could bring, and emphasized strict security standards. The auction includes high-level security regulations, requiring TIA SCS 9001 certification and diplomatic relations with the country of the technology provider. This is a national measure to ensure the reliability and stability of the 5G network. He added that 5G is more than just a speed increase; it is a platform that requires strict standards for the nation's protection and security.
Future Outlook: Anticipating Increased Participation from Telecom Companies
Currently, Claro has already obtained a 5G license, and Nubicom is in the process of establishing a corporation. Conatel mentioned that other domestic telecommunication companies can also participate in future auctions held under the same conditions. This unconventional government policy is expected to promote competition in the domestic telecommunications market, accelerate the adoption of 5G technology, and in the long term, contribute to indirect tax revenue growth through value-added tax (IVA) and corporate income.
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