Colombia Communications minister announces cellphone contract reforms

Posted on Mar 26 2014 - 6:28pm by Rico
(Photo: Nacion)

The communications minister of Colombia has announced reforms that will allow consumers with permanent contracts to switch phone contracts or handsets.

These reforms mean customers already using cellphone contracts can pay a fee to switch carrier or upgrade their phone. In addition it will now be possible to purchase a phone and apply for contract separately, with a contract that will remove the cellular device costs from monthly bills.

The changes, announced by Communications Minister Diego Molano on Wednesday, will be implemented in July.

Good news for consumers

“The new measure will allow cellular distribution channels, more direct sale stores manufacturers and allow people to upgrade as newer, cheaper models come through.” -Senator Prieto

The Colombian senator who pushed for the reform said currently contracts in Colombia are misrepresenting the actual value of the phone, and locking consumers into contracts.

“The new measure will allow cellular distribution channels, more direct sale stores manufacturers and allow people to upgrade as newer, cheaper models come through,” Senator Eugenio Prieto told La Semana.

According to government statistics, prepaid contracts made up 79.35% of total phone usage in 2013.

More cell phones than people

The latest reforms will impact the entire country, with reports that there are more cellphones than citizens in the nation.

The Ministry of Information Technology and Communications revealed last week that in the fourth quarter of 2013, there were 50,295,114 registered cellphones in Colombia, which has an estimated population of 48,402,128.

Proportion of Market Control per Company

Comcel – 57.61 %

Colombia Telecom – 24.1%

Colombia Mobile – 15.19 %

Virgin Mobile SAS – 0.88%

Uff Mobile S.A.S. – 0.80%

Other providers – 1.41%

This gives an average of 106.7 mobile subscribers per 100 inhabitants.

MORE: More cellphone contracts than citizens in Colombia

Smartphone use in Colombia has seen a 278% increase in the past year due an increase in social media as well as popularity of applications, such as online banking.

Recent years have seen market competition increase as more competitors enter the market. For example, the arrival of Virgin Mobile in April 2013.

MORE: Virgin Mobile launches in Colombia

Sources

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