“Latin American Infrastructure is Still Precarious”

12/06/2013

Internexa, the company that hosted the 19th edition of the LACNIC event held in Medellin, has a network made up by more than 22,000 km of optical fiber throughout Latin America under an “open network” model. According to Genaro Garcia, the company’s general manager, this network is “the backbone of a continental communications system.”

By Pablo Izmirlian

Born as a business unit of Colombian company ISA, Internexa became an independent company, a separate legal entity under the tutelage of ISA, in 2000. Around that time, Colombia began a process for opening long distance backhaul to competition and it was then that Internexa began to lay optical fiber cables.

“We started with a network of only 1000 kilometers, today we have almost 7000 kilometers in Colombia alone,” said Genaro Garcia, Internexa’s general manager since the company’s creation. Garcia has a degree in electronic engineering from the Catholic University of Valparaiso, a PhD from the University of Madrid, and a career in telecommunications spanning more than 30 years.

According to Garcia, the network’s international expansion began in Venezuela and Ecuador, followed by Peru, always based on the same business model: “a network open to any member of the telecommunications sector in need of transport.” “Internexa is like a super highway, the backbone supporting a communications system, an express train.”

“Right now our network connects 82 Latin American cities, each of them having more than 300,000 or 400,000 inhabitants.” During the LACNIC 19 event, among other topics, he spoke with LACNIC News about how this infrastructure is maintained and the challenges that need to be faced in order for it to grow.

In Internexa’s opinion, considering the growing bandwidth demand and especially the increasing popularity of online video, what is the expected service life of the network already installed today?

This is causing mobile networks throughout the world to collapse. Optical fiber is a scarce resource, not so much in terms of the amount of fiber that needs to be deployed but in terms of the means needed to support it. Optical fiber must be laid over a very good support system, which is why we take advantage of our synergy with our parent company and the electrical infrastructure, because otherwise it would have to be buried and so on and then it would become very vulnerable. In this sense optical fiber is scarce and costly. Those are the cons. Now for the pros. First, when you invest in deploying a fiber optic network, the cost of laying ten pairs versus 25 pairs is marginal. Second, every year coupler electronics allow increasing transmission capacity. Two years ago, 2.5 Gbit/s of transmission capacity was viewed as the latest in high-capacity links. Today this number has increased to 100 and manufacturers are already speaking of 200 and 300 Gbit/s systems. So it’s fair to say investments are needed. We need to look for economies of scale so that we can not only satisfy the growing bandwidth demand but also build a financially sustainable operation.

So, in your opinion, the current network still has several decades of service ahead?

Optical fiber service life is 20-25 years, but what really determines its service life is the quality of the infrastructure on which it is installed. Why? Because, if this infrastructure is weak, optical fiber  cables will suffer many cuts and, while those cuts can be repaired, each cut causes damage to the network. Some optical fiber cables are already 30 years old. Ten years ago we thought these cables needed to be changed, yet we have been able to increase their capacity thanks to improvements in coupler electronics.

Given the fact that Colombia has such a complex geography, do you now find it easier to install networks in other parts of Latin America? Is that one of Internexa’s differentiators?

It’s a differentiator in the sense of all the knowledge we’ve gained. In Colombia we have five rings, this is what geography demands. That gave us the experience needed to do it outside of Colombia and to acquire existing infrastructure in Chile, Argentina and Brazil. That is product of experience, but the business model is even more important. We do not reach end users, we are wholesale providers, we sell exclusively to operators. This means we can build that economy of scale I mentioned earlier, while at the same time it is useful from the point of view of things such as those we are seeing at this conference, which make it possible for operators unable to build their own networks to have equal access to a network that provides the same service they would render themselves. As to geography, although Colombian geography is quite complex, other places also present difficulties. In Peru, for example, the desert made the solution quite complex. Overall, Latin American infrastructure is still precarious, so being able to develop a business model that shares that infrastructure among many stakeholders is very good for competition and for the industry’s development.

[RECUADRO 1]

Internexa: A 22,000 km network that continues to grow

“It’s like knitting, in the sense that we create optical fiber network interconnections and equip them with transmission equipment that allows us to do what we do today,” says Genaro García. “The 22,000 km network starts in Caracas and covers the entire Pacific, it runs through Colombia, Ecuador, Peru, it reaches Chile, it crosses over to Buenos Aires and heads up along the Atlantic coast to Rio de Janeiro, Brazil. Those 22,000 km are already in operation. Another 1800 km are currently being commissioned in Central America, where there is a company in which we are a minority stakeholder, and which involves the six Central American countries plus other partners such as Mexico’s electricity transmission company, ISA, and Endesa of Spain. About a year from now we will have a network of 24 or 25,000 miles.”

[RECUADRO 2]

“Buying the Internet in Florida”

“In Latin America, for many years – I say this colloquially – we have been buying our internet in Florida. What does this mean? It means that, in order to have connectivity, each country and each company within each country must purchase an international link to reach the NAP of the Americas or one of the major global Internet providers. When I say that we are trying to build a truly Latin American Internet, I’m talking about the infrastructure I have just described. By interconnecting countries, interconnecting NAPs, and mirroring content we are creating a new Internet.”