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Colombia 2015 | TELECOMS & IT | INTERVIEW

TBY talks to Juan Carlos Archila Cabal, President of Claro, on reinvesting profits, improving 4G availability, and working with the public sector.

Juan Carlos Archila Cabal
BIOGRAPHY
Juan Carlos Archila Cabal obtained a Master’s degree in International Business Studies from the University of South Carolina in 1994. He went on to become the Director and General Manager of Motorola de Mexico in 2002. In 2004, he was appointed Vice-President of the same company. In March 2007, he assumed the position of President of Brightstar Corporation Latin America in Mexico. Archila has been President of Claro for América Móvil in Colombia since 2009.

Claro has been reinvesting around 70% of its profits into developing the company. Where are you allocating that reinvestment?

Claro has been reinvesting in its 4G network so as to meet the commitments we made at the time of the 4G spectrum auction. These commitments greatly exceeded those of our competitors, in terms of the towns and communities that we intended to cover. It is critical that we build a 4G network, allowing us to offload data traffic from the 3G network so as to adequately use that spectrum, given our significant disadvantage compared to our competitors in terms of spectrum allocation. We have to serve close to 30 million subscribers with the same spectrum amount that our competitors serve far fewer subscribers with. Therefore, our reinvestment is critical not only in terms of providing a better and faster service, it also in terms of improving quality for all our users.

You plan to offer 4G services to your current subscribers at no additional cost. How will you achieve that, and does Claro have the capacity to do so?

We intend to offer 4G services to 100% of our consumers. However, for this to occur, we need a whole new coverage network. With the necessary infrastructure in place, if 4G is not available, the customer's device will select 3G, or 2G. Today, our 4G coverage has reached 55% of homes and businesses throughout Colombia within a year, and we am at 100%. Of course, none of this helps if people are not using devices that are 4G enabled. We used to be able to subsidize these devices, but currently a regulatory restriction forbids this practice. In response, we are implementing an aggressive sales campaign for phones and installment payments. Today, you can get a smartphone with us for just $1.70 a month. Our role is essentially to make technology accessible and useful to consumers throughout the country and across all social strata.

How are you working with the public sector to improve connectivity?

We work with the public sector in a variety of ways, because ultimately our interests converge. Installing the fiber optic network across the country, implementing the 4G network, increasing data mobility, and introducing faster and more widespread internet access benefits for Colombia overall. These projects are in line with the government's own plans to develop the IT sector and increase broadband connectivity. In 2015, we have issued significant subsidies in education, with 300,000 tablets being delivered to students of lower socio-economic status. We also developed a platform called Educlick, which is the Wikipedia of education in Colombia, enabling teachers to upload five-minute lessons that can be shared nationwide. There is much more to be done and ways to use the network for education in Colombia, and we hope to be at the forefront of new projects like that. Another area where we are active is healthcare. Claro is tapping into some of the developments that Fundación Slim has done in Mexico. There is no such foundation in Colombia; however, we are adopting the model to, for example, reduce infant mortality.

How do you assess the level of competition in this sector in Colombia?

There are nine mobile and 20 fixed operators in Colombia; therefore, competition is stiff. In terms of what differentiates us in telecommunications in Colombia, Claro has clearly led on the investment side, even though particularly depressed times where investments were scarce, and in some of the toughest parts of the country. Still, we did that through our 20-year commitment to investing in the country and to driving technological growth and development across Colombia. There is no better contribution to competition other than to compete. Our efforts have driven our competition to keep up with us, and to offer services that we offer. As the government ensures the spectrum is available to everyone, competition also increases. Private entities have the task to deliver and create opportunities to convey value to consumers, to invest in delivering that value, and ultimately reap the rewards of those investments.