Archive for February 5th, 2011

The Destruction of Venezuela’s infrastructure by the revolution, one step at a time

February 5, 2011

In the 1980′s phone service in Venezuela was the pits. It got to the point that to get a call through, you had to try two or three times before you even got a dial tone. If your phone stopped working, sometimes you had to wait months before the line was fixed. If you had no phone, you had to wait sometimes years before you got service.

Then in 1991, the company was privatized, part of it sold to GTE, later taken over by Verizon, and the service started improving.I still recall the night of Chavez’ coup in 1992, I connected to the Internet to a network of Venezuelans on then nascent Internet called Atarraya and stayed connected all night. I was afraid that if I disconnected my modem, I would not be able to get a dial tone again.

The arrival of cell phones helped, the company go a new revenue stream, which it used to fix up the system. Then the Internet came, first dial=up and later DSL, called ABA here, another new strong revenue stream for a company which now even had competition.  In 1997 the remainder shares of CANTV were sold to the public, both in Venezuela and abroad and the company’s stock listed in the New York Stock Exchange. By the time Chavez arrived in power, the company gave good service and was profitable.

In late 2006, Mexican Carlos Slim tried to take over the company for $21 a share. As the regulator considered the tender, Hugo Chavez feeling like the rich Dictator of Venezuela ordered that the Government buy the company. Rather than spend the money on housing or hospitals, Chavez spent two billion US$ buying the company to satisfy his unlimited desire for power. Amazingly, he offered $17.6 per share, less than what Slim was offering, and one investment fund in the US, Brandes, still has an arbitration case pending because of this at the World Bank.

Move forward three years later after the nationalization and we have come full circle. After only three years, CANTV’s service has begun deteriorating. My own phone stopped working about two or three weeks ago and every time I report it, I am told about a different date for my line to be back. Right now the target date is February 18th. , making it sound like the old CANTV. I am not alone, I have heard lots of people facing similar problems for the first time in a decade and  half. (I ahve asked that I don’t be charged the service for all this time and have yet to find a way to ahve this done at CANTV)

While I have no voice line, I still have DSL, which is a little surprising, I thought it came over the same pair of copper wires. Except that it seems as if it gets worse every day. Right now for example, this is what I get if I do a speed test at

This is actually much better than it has been in the last three days. Of course, it is abominable service, I pay for over triple that download speed and the upload speed is just laughable. In fact, the post is likely to take a while to upload, so instead of saving the draft as I write and correct, I am copying it so as not to lose my work.

Yesterday the service got even worse, my download speed was about 20% of that above, but I learned from Twitter that this was generalized. I was unable to read El Universal last night and the New York Times page took forever to download. I did manage to read it only once. People in Twitter reported all sorts of different problems, depending on where they were.

But as local newspaper El Nacional reported this problem, the Government’s attitude was to deny this was happening. It got so laughable that a former Minister of Telecommunications denied this was taking place, not only denying that the problem existed, but assertively saying that this was a media campaign to manipulate opinion on internet services in Venezuela. He even went further, specifically blaming Alberto Ravell, formerly of Globovision for the campaign, saying:

“Ravell is mounting a campaign of manipulation on the internet services, launching rumors to measure the reaction to them”

Curiously, CANTV reported today that the problem had been fixed in a press release, saying that it was found at one of the distribution points for the DSL service in the country.Only two or three times in the last four years has Internet service suffered like this.

We truly have come full circle under Chavez. A service we had taken for granted like telecommunications, has now gone the same route as water, electricity, infrastructure. Much like the Government does with everything, the solution is to distract, deny, escape responsibility. Billions of dollars wasted in buying out companies only to later run them into the ground, wasting precious funds that could be used to solve the myriad of problems that people face, from infrastructure, to health, to poverty, to education.

It is just another step in the destruction of the country’s infrastructure by the revolution, as the Chief Terminator moves on to other problems he has ignored for the last twelve years. Unfortunately, this will be more work (and money!) whenever the reconstruction of the country begins anew or will become another promise by Chavez, if he stays in power, the day the CANTV problem becomes so general, that people begin to complain massively.

It’s happened before in the pretty revolution…



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