Information Technology in Peru

Internet Diffusion

Because the Internet only really reached Peru in the mid-1990s, all discussions of Internet diffusion must keep in mind the extremely short time frame in question. Given the short life of Peruvian Internet access, there has been substantial progress in the growth of Internet hosts and also PC ownership, as well as in the decreasing cost of Internet access. Much of the success of the Internet in Peru can be traced to the Peruvian Scientific Network, due to their innovative plans.

Internet Users

Peruvian Internet use has taken off in the last few years. In early 1998, there were an estimated 208,200 Internet users in Peru. Over the next eight quarters, total users increased every quarter between 4% and 18%. By the first quarter of 2000, there were an estimated 520,000 users, an increase of 250% over only two years.(20) Based on this estimate for early 2000, approximately 1.8% of Peruvians are online.

Brief Overview of Peruvian Internet Development

In a 1999 report, Ramiro Montealegre examined the development of information technology development in less-developed countries, including Peru, with an emphasis on the role of institutions in such development. He compiled a timeline, focused on the Internet, which broke Peruvian development down into five phases:

  • Phase 1: Searching for a Solution (1990-1991) - In 1991, Peruvian universities and NGOs formed the Peruvian Scientific Network (RCP), a nonprofit institution charged with investigating the potential for a national academic and research network.
  • Phase 2: Building Competence (1991-1992) - RCP began with a grant for basic equipment from the UN Development Programme, and three telephone lines and an X.25 connection from a Peruvian university. Private institutions did not have much faith in RCP's chances of success, and the government refused to be involved in a consortium that was not government-controlled. ENTEL, the state's postal, telegraph and telephone (PTT) agency, refused to cooperate with RCP due to fears of competition with ENTEL's X.25 service. UNDP brought in two American engineers to set up the network, and the engineers ultimately stayed for three months to completely train the Peruvian engineers.
  • Phase 3: Expanding the Solution (1993-1994) - 1n 1993, the Organization of American States financed a satellite antenna for Peru, and by February 1994, the Peruvian network was upgraded from WCP to TCP/IP. Also in 1994, RCP began operating as an Internet network via a PanAmSat connection to an earth station in Florida, with the sponsorship of the U.S. National Science Foundation.
  • Phase 4: Enabling Changes (1994-1995) - In early 1994, RCP had 120 associated institutions and financial support from the OAS and NSF. RCP set about raising its profile by training institution personnel and holding conferences, developing tools and manuals and creating directories of Internet resources. By the end of 1994, RCP had 420 member institutions, including not only universities and research institutions, but also NGOs, civil associations and even government agencies.
  • Phase 5: Evolving Strategy (1995-1996) - In 1995, RCP began development of a national backbone, which was to consist of consortia in each of the 24 regions of Peru, each with a dedicated 64Kbps line to Lima. This configuration was intended to allow anyone access to the resources in Lima, increase institutional cooperation, decrease communication costs for research institutions, and offer technology training. Backbone development was hindered by a poor telephone network and a lack of capital, but it did progress. RCP also initiated its cabinas publicas program, which is described below. By 1996, RCP had 2,149 members, 73 percent of which were businesses and individuals, and the remaining 27 percent were nonprofit institutions.(21)

Internet Hosts

In addition, the number of internet hosts grew dramatically in the late 1990s. According to the International Telecommunications Union, the number grew from 171 to 4,794 over those five years, as noted below:
1994 171 hosts
1995 813 hosts
1996 5,192 hosts
1997 3,415 hosts
1998 4,794 hosts

PC Diffusion

Concurrent with the rise in Internet use and hosts was a rise in the number of PCs used in Peru. The ITU reports the following figures from 1995 to 1998:

1995 150,000 PCs
1996 200,000 PCs
1997 300,000 PCs
1998 450,000 PCs
Although PC sales figures were not provided, NUA notes that second quarter PC sales experienced a 13% drop from 1998 to 1999.(22)

Cost of Access

The cost of Internet access has also dropped dramatically. In July 1996, Peruvians paid an average of nearly $40 per month for Internet access. By late 1999, that figure had dropped to $13.73 per month. By comparison, monthly Internet access fees in Latin America tend to be much higher:

Brazil $26.96 per month
Mexico $26.10 per month
Argentina $41.90 per month
Colombia $36.56 per month
Chile $40.27 per month(23)

Internet Service Providers (ISPs)

According to the Ministry of Transportation, Communication, Housing and Construction, there are 58 ISPs in Peru as of 2000(24). The largest ISP in Peru is the Peruvian Scientific Network, known by its Spanish initials as RCP. RCP began as a consortium of 43 non-governmental academic and scientific organizations with the sole purpose of providing information and communication technologies to the underserved in Peru. It proceeded to build its own Internet backbone throughout the country, providing access to rural areas as the backbone was activated in the various regions of Peru. RCP has become well-known for its cabinas publicas, or Internet cafés which provide unfettered access to the Internet in different configurations. One configuration is similar to the telework centers currently spreading across the United States, in which a bank of computers are connected to the Internet, as well as all necessary peripherals, such as scanners and printers. In addition, RCP provides training and staff to ensure that the users can take full advantage of the hardware. At the other end of the RCP spectrum, they have installed monocabinas, which are essentially single computers with Internet connections, often in rural areas such as village centers, that are analogous to telephone booths. For a fee of $15 per month (including telephone charges), Peruvians can access the Internet for 15 hours. RCP claims a 56% share of the Peruvian ISP market at present, with most of the remainder divided between Telefónica and IBM. In addition, by virtue of being the first Peruvian ISP, RCP administers the .pe top-level domain. RCP's success in Peru has led to international expansion plans, as it moves to replicate its model in other Latin American countries, beginning with Uruguay in 1999.(25)

Telefónica of Peru also commands a large share of the ISP market with its UNIRED service, and also provides a service called Infovia, which connects a series of information centers that end-users can access for the cost of a local call. Other ISPs use this service to carry information and data. However, Telefónica does not disclose market data, so it is difficult to tell how much of the market for such services it holds.

Major Internet Service Providers(26)
APLITEC, Aplicaciones Tecnologicas S.A.
AMERINET provides internet access, mail fax, electronic mail, housing, hosting, web page building video conference and consulting services to corporate and non-corporate sectors
LIMATEL S.A. provides internet access, housing, electronic mail, enhanced fax, mail fax, electronic data interchange, internet business dial, and consulting mainly to corporate sector
PERUSAT offers internet services to individual and corporate users
RED CIENTIFICA PERUANA - RCP INTERNET PERU provides internet access to many government organizations, educational institutions and home users. RCP is developing an online shopping mall and has plans to expand its business to other regional markets
TELEFONICA DEL PERU / TELEFONICA SERVICIOS INTERNET provides internet access, housing, web page building and consulting to corporate clients
TELEMATIC NET provides internet access, housing, web page building, hosting, intranet development, consulting, and information services such as cyber-employment, cyber-mall and cyber-economics
TELEREP E-mail: [email protected] provides telecommunications services such as internet access, as well as equipment and accessories

Last update: December 19, 2000 by Jeffrey S. Bernstein.