Tuesday, January 26, 2016

Cuba still wary of U.S. telecom and Internet offers

Cuba still wary of U.S. telecom and Internet offers

U.S. and Cuba concluded three days of telecom talks last week
Despite new U.S. rules, Cuba proceeding cautiously on deals with U.S.
Head of U.S. delegation says he sees a limited window for Cubans to act

After a second round of meetings in Havana, Daniel Sepúlveda, the U.S.
point man on telecom policy toward Cuba, says the United States feels an
urgency to make progress and sign deals while President Barack Obama is
still in office but Cuba appears to want to take its time.

Sepúlveda, the coordinator for international communications and
Information policy in the State Department, led a 14-member delegation
that held talks Wednesday through Friday with their Cuban counterparts
to discuss U.S. regulations that allow American telecom and Internet
companies to engage in a wide array of commercial activities on the
island — if Havana wants to take them up on their offers.

Cuba has one of the lowest connectivity rates in the world, and only an
estimated 5 to 25 percent of Cubans have any type of Internet service.

Both sides categorized the talks — the first since March — as positive,
and Sepúlveda said U.S. companies continue to visit the island in hopes
of striking deals that would improve telecom infrastructure and Internet
connectivity for Cubans.

"We're doing as much as we possibly can on our side. At this point, the
biggest thing that is missing is trust" -- on both sides, Sepúlveda said
Monday in an interview with the Miami Herald and El Nuevo Herald.

New U.S. rules allow American companies to sell personal communications
equipment in Cuba, work on joint ventures with Cuba's telecom monopoly
ETECSA to improve the island's outdated Internet and telecom
infrastructure and open offices in Cuba and hire Cubans to staff them.
The new regulations also mean that a U.S. company could, for example,
hire a private Cuban coder or other service provider.

In all its recent dealings with the United States, Cuba has emphasized
its priority is an end to the embargo, and in a Foreign Ministry
statement at the end of the telecom talks, Cuba mentioned "the
limitations of the new regulations adopted for this sector by the U.S.

Sepúlveda, however, emphasized that the new telecom regulations were
more open that those for any sector that the United States permits to do
business with Cuba.

The U.S. delegation also included Thomas Wheeler, chairman of the
Federal Communications Commission; Dean Garfield, president of the
Information Technology Industry Council, and representatives from Cisco
Systems, Comcast, the North American division of Erisson, a Swedish
communications company, and other government and industry officials.

"The hunger on this side — from business — is big," said Sepúlveda.

He said there are at least a half-dozen proposals — both by U.S. and
non-U.S. companies — to construct a North-South undersea fiber optic
cable between the United States and Cuba. Currently, Cuba's only
connections are through satellite and an undersea fiber-optic cable that
links the island and Venezuela.

Sepúlveda said successful deployment of Internet networks anywhere in
the world have included three elements: an attractive environment for
direct foreign investment, investments in infrastructure and joint
ventures — particularly for wireless.

The Cuban government has said that its goal is to offer Internet to 50
percent of households by 2020 and to have 60 percent mobile penetration
by then.

The feedback the U.S. delegation got from the Cubans was they would take
the cable and other joint venture overtures under consideration, but
that the Internet/telecom industry wasn't currently one of their main
economic priorities, said Sepúlveda. The message from the Cuban side, he
said, was that while they are open to seeing the U.S. ideas, they "want
to move very carefully" and "Cuba is going to move forward in its own way."

Sepúlveda said his response was: "Fine and good but we have a window of
opportunity here." Obama, who announced the historic opening with Cuba
on Dec. 17, 2014, is in the final year of his term and some Republican
presidential hopefuls said they plan to reverse his overtures toward Cuba.

He said that even though his job is advocacy and creating a policy
environment conducive to a communications opening, rather than helping
with business deals, "We need to have some solid wins to give [U.S.
business] confidence."

The U.S. delegation met with Jorge Luis Perdomo, Cuba's vice minister of
communications and officials from Cuba's foreign relations and foreign
trade and investment ministries as well as Cuban bloggers, university
students and faculty. They also visited a Youth Club where teens were
learning about the Cuban Intranet and the Internet.

In a speech at Havana's University of Information Science, Sepúlveda
said, "We strongly urge the Cuban leadership to respond to this
initiative because it will benefit both our peoples."

In the past year, he said there has been progress: Cuba has opened 58
public Wi-Fi hotspots with more scheduled for this year; the cost of
Internet access has dropped by more than half to $2 an hour — although
he said it was still too expensive; and Cuba is investing in DSL
technology. In his interview with the Herald, he also cited Cuban
roaming deals struck by Verizon and Sprint.

But he added that Cuba needs to "loosen regulations for consumer and
residential Internet use" and also has the ability to skip generations
of technology by upgrading from mobile networks that operate primarily
on 2G technology to 3G or even 4G networks.

Source: Cuba still wary of U.S. telecom and Internet offers | Miami
Herald -

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