Project spotlight: Chile’s national fiber optic backbone

Construction of Chile’s 10,000km fiber backbone known as Fibra Óptica Nacional (FON) is due to begin in March 2021, according to Miguel Mansilla, CTO of local operator WOM, which won a tender to deploy the largest part of the project.

WOM was awarded in April a contract to build fiber in five of the six macrozones comprising the carrier-neutral network.

The carrier estimates investments of US$82mn to cover 143 of the 186 municipalities, deploying 7,000km of the project’s total, Mansilla said in an online event held by the Chilean construction chamber (CChC).

The fiber optic project was announced in May 2019 by President Sebastián Piñera. The goal is to improve connectivity for some 2.5mn residents in underserved areas from Arica in the north to Los Lagos region in the south.

FON is also expected to connect to Fibra Óptica Austral (FOA) – a 4,000km network of submarine and terrestrial fiber being deployed Puerto Montt in Los Lagos and Puerto Williams in the far south.

The government is subsidizing part of the FON project because it encompasses zones with low population density and low commercial appeal to the private sector. 

The last macrozone, grouping the southern regions of La Araucanía, Los Ríos and Los Lagos, was not awarded because the only bidder, Mundo Pacífico, did not meet the financial requirements.

"We had only one offer there. Besides, the prices they were proposing for all the people in the region were 3-4 times higher than for all the other macro zones… so we voided it," said telecoms undersecretary Pamela Gidi.

Subtel plans to issue a new call for that zone, with some changes in the terms, in September, Gidi told the event.

Under the terms of the FON contract, the backbone must go live before the end of 2022 and the network must be available for use by all operators. 

Since its arrival in the Chilean market in 2015, WOM has invested around US$800mn, most of it in infrastructure, Mansilla said.

“The fiber project represents about 50% of the investments needed to advance the reduction of the digital divide in the country. The other 50% should come with the expected 5G tender,” said the CTO.

After a supreme court ruling approved the country’s spectrum policy, Subtel plans to move forward with the 5G tender, details and terms of which are expected to be announced in coming days.

Chile aims to award 1,000MHz of spectrum in four bands: 700MHz, AWS, 3.5GHz and 28GHz. The watchdog will offer 20MHz in 700MHz, 30MHz in AWS (1,700-2,1000MHz), 50MHz in 3.5GHz and 850MHz in the 28GHz band.

According to Carlos Cruz, executive director of the Chilean infrastructure policy council (CPI), the government is on the right track with its policies, but "we see several other spaces for collaboration that could advance in the public-public, public-private and private-private spheres.”

A key public-public collaboration to be advanced is speeding up permits for installing antennas and other telecom infrastructure at the municipal level, he said.