How and where Uruguay's leading carriers are investing

Uruguay has one of the most advanced telecommunications industries in Latin America in terms of fiber penetration, mobile network quality and speeds, and digital services.

The favorable business environment and the generally good telecoms and electrical infrastructure have also helped spur investments in datacenters and edge computing, in addition to the boost from submarine cables docking at the city of Maldonado.

Despite its small size, the country also has a reputation for exporting services and software to other countries.

Uruguay's telecommunications market is expected to reach revenues of US$2.46 billion in 2024, expanding at a compound annual growth rate (CAGR) of 0.55% until 2029, when that figure should climb to US$2.53bn, according to an estimate from Mordor Intelligence.

BNamericas takes a look at the investment plans of the leading players in the local market.

ANTEL

From an infrastructure perspective, state-controlled Antel, the largest telco in the market, is largely focused on expanding its 5G network, with plans to have 500 5G sites up and running by the end of the year.

Its main 5G network and infrastructure suppliers include Nokia and VMware.

By the end of May, the company claimed to have around 300 5G antennas in place, which leaves another 200 to be installed by year-end.

Overall, Uruguay had 6,586 mobile base stations at the end of last year, considering all technologies, according to statistics from regulator Ursec. Antel owned 46% of the total, Claro 30% and Movistar 24%.

While connectivity continues to be the company's main source of revenues, Antel is betting on offering more aggregated services, such as technology and content, rather than just internet.

Generative AI is one of the firm’s bets to enable services for specific demand through content personalization, for example. The company is also considering using technology to improve its data traffic management.

The group's 2020-24 capex is US$751 million, including expenditure related to datacenters and submarine cables.

Antel invested US$156mn last year, mostly in infrastructure for 5G networks and fiber deployments in Montevideo and provincial cities. That figure was virtually the same as the capex reported in 2022, but with a greater focus on 5G and fiber.

In July last year, Antel said it planned to spend US$43mn on 5G in 2023 to connect 200 locations.

MOVISTAR

The capex planned for this year by Telefónica’s Movistar unit is US$48mn, mostly for spectrum and to expand and update its mobile network, according to a presentation by local executives this week.

According to the company, its 5G rollout is moving forward as planned, starting from the most densely populated areas and spreading to the rest of the country, but the telco did not provide further details of that work. 

Movistar paid US$28mn for 3.5GHz spectrum blocks in the 2023 5G auction. 

The company claims to have invested more than US$660mn in Uruguay since launching mobile telephony in the country more than 30 years ago.

Movistar also operates a Digital Excellence Center in Montevideo, a hub with more than 40 experts in different disciplines who work on the company's strategic initiatives and export digital services to the eight countries in the region in which Telefónica operates.

Movistar accounted for 23% of Uruguay’s 6.7mn mobile lines at end-2023. Antel had 60% and Claro 17%. 

Movistar had just 862 clients in fixed broadband, less than 0.1% of the total market. Antel has 1.08mn of these accesses, so it has a virtual monopoly.

Last year, Telefónica invested 938mn euros (US$1bn) in its HispAm arm, which includes Uruguay. It does not provide a breakdown of the figures for each country.

However, according to Telefónica HispAm, the company has seen a 17% reduction in energy consumption in Uruguay after the local switch-off of 2G networks.

CLARO

Like Telefónica, América Móvil does not usually break down capex by subsidiaries. The Mexican telecoms powerhouse reports its operations in Uruguay together with those of Argentina and Paraguay, as part of a single Claro business unit.

In the 2023 spectrum auction, América Móvil was awarded a 100MHz block in the 3.5GHz band in Uruguay for a fee of US$28mn.

The company's main investment focuses in the country revolve around 5G coverage commitments, in addition to the possibility of using Antel's fixed network in the wholesale model to offer residential broadband.

Ursec established that the carriers winning spectrum will have to deploy 70 5G antennas and at least two base stations in at least 10 departments, excluding capital Montevideo, in the first two years of the 5G contract.

In the following 36 months, both Claro and Movistar will have to deploy at least two base stations in each of the country's 19 departments. Claro does not report how many it has deployed to date.

Overall, the América Móvil group plans to invest US$7bn this year globally, down from US$8.5bn in 2023, including spectrum.