A new chapter in the competition High-speed connectivity It takes place in the medium-sized cities of Argentina. Independent internet service providers (ISPs) are emerging as competitors, challenging the traditional dominance of large operators such as Telecom Argentina.
This process will be accelerated by an environment of provincial fiscal incentives aimed at accelerating the adoption of the Direct-to-home fiber optic technology (FTTH, acronym in English).
Entre Ríos and its regime to attract investment
The province of Entre Ríos is considered a pioneer of this investment-friendly strategy. The company Internet serviceswith a 25-year history in the telecommunications market, announced an investment plan of one and a half million dollars.
This capital will be used to build an FTTH network that will cover 98% of households in the city in an estimated period of 90 days Gualeguayfrom which around 19,000 families benefit directly.
What is special about this project is that it represents the first telecommunications initiative in the province to officially access the tax benefits it provides New investment incentive regime (RINI).
This regime was implemented as part of the province’s compliance with regulations and principles Incentive system for major investments (RIGI) at national level. The RINI, which will come into effect in 2024, has the primary goal of attracting capital to the province for projects deemed strategic. Its pillars include:
- Exemption from gross income tax over a longer period of 15 years and offers basic financial predictability.
- Financial stabilitythereby ensuring that tax conditions are not changed to the detriment of the investment.
- Simplification of bureaucratic and administrative proceduresthereby reducing friction when implementing projects such as building next-generation connectivity networks.
This measure is intended not only to stimulate the province’s economy through capital investment, but also to generate capital more level playing field in the connectivity market and directly benefits the end user with better services.
The rise of fiber and competition driven by SMEs
The investment in internet services is linked to the growth of fiber optics throughout Argentina. The company, which already has one Expansion plan for 150,000 apartments in 28 citiesillustrates the crucial role of non-traditional operators.
According to the Argentine Internet Chamber (Cabase, an acronym for an earlier stage of the organization), in the first half of 2025, more than 50% of fixed lines in the country were already using FTTH technology.
This technological change has largely been driven by the investments and efforts of SMEs and cooperative operatorswho proactively built infrastructure in areas and cities where major incumbents delayed arrival or focused on older technologies.
In Gualeguay, the new Internet Services network will guarantee high speed and offers symmetrical connections (same upload and download speed) which will vary between 300 and 800 MB. This capacity is critical to enhance modern activities such as telecommuting, high-quality digital education and entertainment in ultra-high definition (4K) formats.
Patricio SeoanePresident of Internet Services, underlined the importance of this digital infrastructure: “Just as in the 19th century the railway defined which cities prospered and which were isolated from the economy and progress, in the age of the digital economy and artificial intelligence (AI), connectivity and high-quality digital infrastructure play a fundamental role.”
Telecommunications and the brand unification strategy
In response to this competitive scenario, which is intensifying across the regions, Telecom Argentina has implemented a strategy to unify its services. All products and solutions are now managed under a single brand staff.
The objective of this consolidation is to strengthen the company’s leadership position by creating a comprehensive digital ecosystem. This ecosystem includes fixed and mobile connectivity, entertainment services, digital financial solutions and smart home technologies and seeks to present a unified and robust front in the face of growing regional competition from ISPs.
This brand unification comes as the sector remains on tenterhooks regarding the potential telco merger Movistara process that requires approval from the National Communications Entity (Enacom). Independent ISPs are closely monitoring this development and are aware that an eventual merger could significantly change the competitive landscape at the national level.
The ongoing challenge of high tax burdens
Despite the remarkable momentum in FTTH deployment, led by SMEs and cooperatives, which concentrate a significant proportion of new fixed broadband registrations (Around 40% of the total nationwide are already equipped with FTTH), the telecommunications sector faces a structural obstacle: an excessive tax burden.
A joint study by Center for Public Finance Studies (CEFIP) of the National University of La Plata (UNLP) and CABASE showed that connectivity services in Argentina carry an average total tax burden of 41.5%.
In some jurisdictions, this percentage peaks as high as 44.5%. This is particularly stressful Gross Income Taxwhose industry average rate is 4.21% and even exceeds 5% in several provinces, representing an important barrier to reinvestment and infrastructure development.
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