When Enrique Ortiz de Montellano, president and CEO of Claro Puerto Rico, landed his first job in the telecommunications industry, he received an NEC, an elongated mobile phone manufactured by a Japanese company located 6,705 miles away from his native Mexico.
He was 25 years old and the company cell phone was his first mobile ever.
“I had graduated from college and was working at a cell phone company,” Ortiz remembered while laughing.
At the time, the young businessman could never have imagined that the bulky and cumbersome device he had just received would become in -a relatively short span of time- an intrinsic part of our lives.
“Initially, it was viewed as a service for a certain level of the population. Then came its massification and we saw that it was everybody,” Ortiz recalled of the early days.
The company continues its focus on innovation and customer experience
Twenty-five years after that encounter with the device, Ortiz sat with THE WEEKLY JOURNAL in a spacious conference room at Claro’s headquarters in Guaynabo to ponder the evolution of the cell phone industry and the voyage that brought him and his family to the island.
In 2007, Claro’s parent company América Móvil acquired Puerto Rico Telephone Company from Verizon. A year later, the businessman -who holds a degree in graphic design and a master’s in business and marketing- became the head of a company that has 3,000 employees and has branded itself as the leader in telecommunications on the island. “Claro is among the top 10 employers on the island,” Ortiz said with pride.
While he guards his private life, Claro’s CEO was quick to share his views on the island, noting that Puerto Ricans have strong Latin American roots and predicting that the grounded telephone line won’t disappear. “The phone got transformed. At one point, Puerto Rico had 1.2 million lines. Now it has some 600,000 lines, still a lot.”
During his tenure at Telcel, the principal subsidiary of América Móvil, Ortiz held different positions, among them, as chief of corporate image, marketing director and regional director for Sonora and Sinaloa, giving him the opportunity to learn about different perspectives of the industry.
“In the beginning, the technology connected physical places like houses and businesses. But as technology evolved and became wireless, it began connecting people. Since we have more people than places, the market grew because connections multiplied,” Ortiz noted of the changes in the cell phone sector.
According to the Puerto Rico Telecommunications Regulatory Board, the island has more cell phones than people. Last month, the agency reported 3,380,477 mobile connections for a population of 3.1 million inhabitants.
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“It’s normal. Some of us have one or two cell phones plus a tablet,” Ortiz responded. “In other places, the market penetration (the ratio between population and mobile connection) is bigger. In Puerto Rico, it stands at 102 percent. But in Panama, it reached 140 percent.”
It’s not just Puerto Rico and Panama. This is a worldwide phenomenon. There are over 9.32 billion mobile connections worldwide in comparison to the current world population of 7.8 billion, according to the United Nations.
Claro’s President didn’t reveal details of the company’s mobile sales but indicated that it has 1.5 million subscribers between its mobile, land and other services.
About the challenges of doing business in Puerto Rico, Ortiz mentioned the slow and bureaucratic permits system.
“The cell towers bring an additional ingredient. Some groups, maybe with a special interest, oppose the antennas. After Hurricane Maria, we saw the people along the highway trying to get closer to the antennas in an attempt to get signal, but now when we are trying to build the antennas closer to their houses, they don’t want them,” Ortiz said, while discarding that these structures could pose health risks.
“We are talking about towers with permits, with the construction underway, and we have these groups opposing them, using cell phones to call more people to join in the protest. It’s time to decide if we want a Puerto Rico connected or isolated with a network saturated with users,” he added.
In his view, AT&T’s decision to leave the island and sell its wireless and wireline operations in Puerto Rico and the U.S. Virgin Islands to Liberty Latin America won’t affect customers.
“There have been those consolidations. They are not new to us. On a good note, very strong companies will remain on the island. That means that the investment and the access to good technology will continue as well as good competition.”
Following that same thought, Ortiz mentioned that Claro continues its agenda to bring more fiber optic to homes and businesses as to improve the internet’s speed and capacity. On the mobile side, the company is working on the 5G network.
“It’s a market with very good purchasing power when compared to Latin America. People also love technology. It is mostly a postpaid market, which is very good. In Latin America, 85 percent of customers are prepaid, but here more than 70 percent of clients have a postpaid service with a monthly payment,” Ortiz indicated of Puerto Rico customers.
As in the United States, 30 percent of mobile users on the island have an iPhone, while the remaining 70 percent carry a device with an Android operating system. “Android people have more options and brands. The iPhone is just one,” Ortiz explained.