The first technology park in the Central American region is located in Guatemala City. In 2008 Juan Mini returned to Guatemala from California and founded Campus Tec. Mini previously started ZipRealty in Silicon Valley where he learned the ins and outs of start up culture. His vision was to leverage the comparative inexpensive average cost of starting a business in Guatemala in order to attract intellectual talent to Guatemala. In 2008 it cost less than $8,000 on average to start a business in Guatemala, while it cost over $17,000 in Brazil and over $39,000 in Costa Rica. The cost advantages for start up and the availability of low rent space in one of Guatemala City’s cultural district neighborhoods were advantages that made starting a technology incubator seem ideal.
Silicon Valley In Guatemala
The hope was to encourage and support software development start up companies and information technology companies that would be export oriented. Campus Tec and the IT community that is now growing around it offer digital services and resources for companies throughout Central and South America. The main building, which is seven stories tall, is now fully occupied with over 100 IT companies, mostly employing entrepreneurial or technology oriented youth. These companies specialize in special effects for movies, video games and software for mobile phones and the internet. This high tech zone is close to the Technology Institute of the Private University del Vaile de Guatemala.
In 2012 a second fourteen story high building was constructed to house more start up companies and to attract international firms, which were already beginning to show up. Some international firms, like MTV were first attracted to Guatemala City’s technology community for the modestly priced contract IT services and back end digital production. For Guatemalans, the digital cycle has gained a foothold with the development of information technology services and especially software development, but the opportunity is not for everyone.
Land And Phones
Guatemala is a poor country where land distribution has traditionally only been among a small group of wealthy families. Like in so many other poor countries around the globe, cellphones are making a difference in land use and distribution. For generations indigenous farming communities had difficulty gaining title to the land they work. But with land reform in Guatemala, the door is open for more broadly distributed land ownership, although each individual must make the proper claims to gain title to the land they seek. It takes knowledge and timely information to work the system to your advantage.
NGO groups like “Land Network” and Mercy Corps have intervened in land tenure disputes in Guatemala in order to provide the knowledge and information to poor farmers. One of the best tools for these interactions are cellphones. The information is often needed at specific times in the land title process and cellphones make coordinating resources in a timely way much easier. The non-profit NGO’s also setup websites that are easily used and provide information to anyone who has their URL. In Guatemala the use of cellphones is only slowly penetrating rural areas. Like everywhere else, in Guatemala the cities get the most modern equipment first and rural areas lag behind.
Although Guatemala’s cellphone penetration is not high by Latin American standards, it is growing rapidly. In 1996 Guatemala’s telecom market, which was exclusively run by government-owned, GUATEL, was liberalized. The industry moved towards competition and away from centralized state control of the telecom infrastructure. By 2001 the number of mobile phones in Guatemala overtook fixed line phones and the growth has continued to pick up pace. Oddly, Guatemala’s mobile phone industry is helped along by one of the most liberal radio spectrum regulatory models in the world. Since cell phones all use radio spectrum the amount of spectrum available determines and can limit the build out of cell phone use. This is not the case in Guatemala. But even with favorable regulations cellphone penetration in Guatemala was only at 88 percent in 2010. But even with slower economic growth since 2009, mobile growth has continued and penetration in 2012 reached 104 percent. Today (2014) it is approaching 150 mobile phones for every 100 people.
Guatemala’s internet penetration is lower than cellphone penetration at about 16 percent usage in 2012, of a population of over 14 million people. The infrastructure in the largest cities is good but in rural areas it is often non-existent. Broadband usage in 2010 was about 2 percent, so Guatemala has one of the lowest penetration rates of all Latin American countries for broadband. Mobile internet access is limited not by the number of cell phone users, but by the low level of broadband development.
Oddly, Guatemala’s digital development is progressing well in Guatemala City and far more slowly everywhere else. The digital cycle is about establishing control of online niches, but that’s not the goal in Guatemala. The urban population, which is generally the more affluent faction is gaining digital sophistication by developing specialized software niches, but since the countries overall digital infrastructure is progressing slowly the software development is tied to the regional and international marketplace. Guatemala’s income gap is part of the reason the digital infrastructure is developing so slowly and therefore there is a two-tiered digital development.