LOCAL LOOP monopoly Telefonica, one of the two incumbents in Argentina, suffered a cut in its fibre optic backbone, leaving a whole province as linked with the mainland as the cast of Lost.

Tierra del Fuego - "land of fire"- is Argentina's southernmost province. It has some of beautiful landscapes and a mere 100,000 permanent residents according to the last census. The city of Ushuaia is now a thriving tourist destination, and the commercial centre for the area. But reservations couldn't be made, credit card transactions couldn't be processed, and banks couldn't operate after the incident on Monday night.

According to reports, a bulldozer working alongside a road accidentally cut a fibre optic cable Monday night, causing the disruption in Telefonica's backbone. It was only fixed by 3:00pm Tuesday.

Sources with experience at the local incumbents told the INQUIRER that the trouble with Telefonica is that besides fibre optic they have radio links, which was also the method used by the former State owned PTT before privatisation to connect the island to the mainland. "As you might understand," he said, "radio links are not exactly state of the art technology."

"RF predictably delays the data flow compared to a pure-fibre optic link, and also limits bandwidth available. Of course satellite is always an option as backup route but it makes delays even worse," our source, who asked not to be named, said.

News reports confirm these delays until the cut was fixed, saying that " fixed and mobile telephony were affected by a difficulty for making calls or by the echo effect present when communications could be finally established".

That was voice, but the loss of Internet/data connectivity meant many people were unable to make credit card purchases as the whole POS credit card network was down. The tourism industry was also hit hard, claiming they were "seriously affected" by the inability to process electronic payments and book flights and hotels.

Not only sights and tourists
This situation of a single cut in Telefonica's backbone and link to the mainland highlights a serious shortcoming in Telefonica's network design. This not only affects tourists and the local population but also to the thriving industries operating there. The city of Rio Grande is the province's industrial capital, where a law promoting industrial development gave birth to a successful electronic products assembly industry. Heavyweights like Philips and others make TV sets, LCD monitors and mobile phones here.

Firms operating under the Industry Promotion laws do not pay import duties on its components, and are exempt of gross income tax and VAT. That gives the firms operating under that regime a 20 per cent advantage over producing in the mainland, according to trade associations.

But of course this advantage doesn't take into account the cost of using the services of the incumbent operator and its reliable network design with plenty of alternative fibre optic routes, back-up links and overall redundancy. *cough*

Some exceptions
Back in January, small ISP firm Ertach - later acquired by Telefonica's arch rival TelMex - and which operates one of Argentina's national WiMAX networks brought WiMAX coverage to Rio Grande. However that - coupled with Ertach's not-really-affordable rates - did not help the thousands of people who still depend on Telefonica's POTS and Internet service for connectivity. A few banks have their own satellite links for connectivity, like Argentina's national public bank Banco Nacion, or the private Macro bank."

This should be a wake up call to the local population about the dangers of relying on the local incumbent which can leave Argentina's side of the big island almost disconnected from the World as soon as a worker hits a fibre optic cable.µ