REGLAMENTO DEL SINDICATO DE [OBLIGACIONISTAS / BONISTAS /
5. CLAUSULAS Y CONDICIONES DE LA OFERTA
5.2 Plan de colocación y adjudicación
The Internet hype spread the notion that geography and location did not matter any more in the context of global networks. If you were connected you could develop online activities as if being in the centres of the world. The main results have shown because of the existence of great inequalities in the deployment of the networks, their capacity and performance, the production and consumption of the Internet is concentrated in few selected cities, those which have the best telecommunications infrastructure.
It is no surprise that the Latin American Internet infrastructure is concentrated in the largest urban agglomerations of the region. ICT has the potential to disperse activities in space, but the paradox is that as telecommunications services improve and the economy organizes itself globally, spatial proximity and cities maintain their importance.
At macro level, the exposed concentration trends, monocentric configurations, advantages of the large markets and sea locations point out to situations where ‘only the rich get richer’ (Drewe, 2003), obviously detrimental to the objectives of sustainable development. At city level, the features of the deployment of premium networks suggest the deepening of a process of ‘splintering urbanism’ (Graham and Marvin, 2001) in the Latin American cities.
These issues highlight the important role played by large telecommunications firms in the new geography of nodes that has emerged in the last years. Outside the full awareness of urban professionals, large telecommunications firms have become important agents of urban change during the last decade. The decisions about the location of the nodes and the number and direction of the links are, for the most part, in the hands of these private firms and are decided according to agglomeration economies and other imperatives of the business world (Malecki, 2002), and with disregard to regional, national or local priorities.
Evidently, the position of a city within the global backbones is of great importance for the attraction of foreign firms and foreign investments, as well as for the smooth link of the urban economies with the global economy. This leads to two other important issues: competition and dependence among cities. It is clear that the networks deepen these two processes. On the one side, the visible trends to concentration demand the cities a competitive attitude of urban marketing, which has little significance for the solution of the urgent problems that affect urban residents in Latin America.
On the other side, multiple links and relationships constitute a great advantage in a context of rapid technological advances and economic instability, which demand a fast reaction and adaptation to new situations. Additionally, the evolution of the regional backbone towards a more decentralised configuration through the emergence and deepening of links among the cities of the region holds many promises. In the context of regional integration, the Internet
backbone network can play a great integrating role connecting locations according to their cultural and economic interests.
The bottom line is that the Latin American metropolises which are the main nodes in the new Internet infrastructure, have abundant and cheap international backbone capacity that is underused. As such they constitute the best places for the location of the most advanced firms in the new economic logic, and in general for the integration of their local economy into the global. This constitutes a strategic advantage for the metropolises at macro level, but the situation is not the same at urban level, where only premium locations enjoy these infrastructural advantages. Further, the decisions regarding bandwidth are still in the hands of the local telecommunications operators, who as intermediaries, can set limits to the connection to the international backbones according to their own goals and strategies. 25
Progressive and innovative urban and telecommunications policies are urgently needed to extend the fundamental assets regarding bandwidth to the whole city including less favoured locations of the metropolises. Relatively low investments would be needed to provide network connectivity to those by-passed places of non-affluent demand.
The purpose of this chapter was to identify the main features of the digital backbones infrastructure that supports the new way of organisation of the economy and the society in the Latin America region, making an examination of the situation of its main metropolises as nodes of this network, as well as of the situation inside the cities. ICT physical infrastructure network is a basic requirement for the development of the Information Society, but not the only one. The next chapter continues with the explorative part, addressing the situation and trends of the networks of production and consumption of ICTs in Latin American metropolises.
Notes
1 This chapter is an extended and updated version of Explorando la red de backbones de Internet en
América Latina ¿Nuevas tendencias urbanas?, presented at the RIDEAL Seminar in Santiago de Chile,
December 2003.
2 The terms ICT networks and telecommunication networks are used here with the same meaning: the infrastructures that carry digital flows.
3 For great part, access networks are still the same than before the Internet. For the digitisation of the networks what has changed are the backbones circuits, switches and routers.
4 Wireless Internet access over unlicensed spectrum technologies (WiFi), such as the IEE 802.11 specification, are increasingly being used in public spaces (‘hotspots’) in airports, restaurants, hotels, corporate sites, universities and other locations.
5 Dark fibre is that which is still not lit up to let the digital packages travel.
6 The most salientamong them are World Com and Global Crossing, with assets (previous to bankruptcy) of 103.9 and 25.5 billion US$ respectively (Shaw, 2002). Historically World Com is the biggest bankruptcy ever (Standage, 2003).
7 The most spectacular sale was the one of Brazil’s giant firm Telebras, which was divided into twelve independent companies and was auctioned for US$ 20 billion in 1998 (Lenzen, 1999).
8 The Mexican Telmex is the only large telecommunication company in the region in which national capital is in control of the firm.
9 In 1998, 29 of the 100 largest companies in the region were in the telecommunications sector according to the Financial Times (Callaos, 1999).
10 Teledensity is the number of telephone lines (or subscribers) per 100 inhabitants.
11 Data taken from the ITU and the websites of the regulatory bodies of these countries (October 2002) 12 Barabasi (2002) explains this uneveness through preferential attachment. In networks that expand through the addition of nodes to an existing network, the new nodes prefer to attach to nodes already well- connected.
13 However, the Telegeography 2001 study concluded that 80 percent of international capacity in Asia, Africa and Latin America is still using U.S. backbones.
14 The final capacity of these two rings is in Terabytes per second (one Terabyte equals thousand Gigabytes), so there is a huge installed capacity.
15The analyses were made with Visual Route software, available at http://www.visualroute.com
16 The National Science Foundation created and maintained these NAPs with the help of a company called MSF to help make the transition from a US government-owned Internet to a commercially-operated Internet.
17 High-speed networks are the ones with more than 384 Kbps (Staple, 2000) ISDN lines are not considered broadband (Paltridge, 2002)
18 The high transmission capacity of fibre optics is amazing: a hair-thin fibre can transmit 60 thousand telephone calls (Graham and Marvin, 1996). They provide essentially unlimited bandwidth, what makes the marginal costs of transmitting additional information on any portion of the route to tend towards zero (Staple, 2000).
19 Optic fibre deployment costs between $ 100 thousand and $ 500 thousand per mile (Acampora, 2002). 20 The incumbent carriers in the large metropolises are Telefónica in São Paulo, Santiago and Lima, Telefónica and Telecom in Buenos Aires, Telmex in Mexico City, ETB in Bogotá and CANTV (owned by Telefónica and Verizon Communications) in Caracas. With sales of 12.14 billion US dollars in 2001, Telmex
is the largest Latin American firm in terms of revenues (Carrasco et al., 2003), which has recently acquired AT&T Latin America.
21 In the US and those countries with high cable TV diffusion, cable modem is the more popular broadband service. In Hong Kong and North Korea, which have very high rates of DSL diffusion, this has been part of a telephone company police to prioritise these services.
22Kofi Annan has challenged ICT experts to think of new ways to bring WiFi applications to developing countries, so as to make use of unlicensed radio spectrum to deliver cheap and fast Internet (Annan, 2002).
23Local by-pass refers to the deployment of a parallel infrastructure network that connects valued users and places while it bypasses non-valued users and places within a city. Glocal bypass does the same but connecting local users and places with global circuits (Graham and Marvin, 2001).
24Routing through multiple hubs and NAPs that provide cheap routes. This happens because the network providers inside the Internet cloud are not motivated to optimise the route, only to minimise the costs. They route the session across inexpensive and usually overloaded links or pass the session off to another cheaper and lower-quality network (Scott, 2001).
25 This situation happened in Buenos Aires, where the carriers who participate in CABASE (the local NAP) limited the international capacity, which resulted in delays and congestion at local level.