Venezuela’s state telecoms company Cantv is facing a widening breakdown in service, with residents, workers and internal documents pointing to theft, neglected maintenance and years of underinvestment as the main causes.
In Barinas, a western farming area where former president Hugo Chavez lived and studied, Ceferino Angulo said a Cantv tower on his 57-acre farm had stopped working. He said he had gone four years without a telephone signal and could not call police when he heard gunshots near his property last year.
Angulo said the tower, installed to serve the surrounding area outside the city of Barinas, had been overtaken by vines. He also said its guardhouse had been abandoned for years and that no Cantv employee had visited in months.
Current and former employees, together with internal documents, said the company has reduced spending on new technology since it was nationalized in 2007 by Hugo Chavez. They said skilled staff have left, repairs have fallen behind and thieves have repeatedly stripped equipment from the network.
The impact has spread beyond homes. Businesses have struggled to operate when phone lines fail, while residents have had trouble registering online for healthcare and passports. Some people in Barinas said they had gone more than a year without a connection.
Cantv declined to comment through a spokeswoman, and Cantv President Manuel Fernandez did not respond to emails and text messages. In remarks posted on a government website last year, Fernandez described the company as a “powerful tool” for expanding telecoms access and building the socialist state, and said internet use in Venezuela had quadrupled since 2007.
Despite that claim, service remains patchy across the country and the government has blamed outages on right-wing saboteurs. Barinas has been among the hardest-hit areas, with coverage lost entirely in some places.
Workers said rusting service vehicles sit outside the local headquarters because the company cannot afford tires or batteries. They also said Cantv offices in the area often go days without internet, and that some electrical circuits serving homes in Barinas have not been replaced since the early 1990s.
Jose Luis Machin, a former mayor of Barinas, called the problem a crisis of investment.
A Cantv technician who showed a Reuters journalist the company’s infrastructure in Barinas said more than 100 meters of copper cable had been stolen from a bridge the previous night, cutting service to a neighborhood. Two other employees said thieves melt down the copper or sell the cables back to Cantv.
As Cantv’s own network has weakened, Barinas’ nearly 300,000 residents have increasingly depended on terminals installed in recent years by Chinese telecoms firms ZTE and Huawei. In one neighborhood, a guard from the National Bolivarian Militia said he had been posted to protect a ZTE terminal from vandals.
Company once led the region ¶
Cantv was founded in 1930 and was once a major telecoms player in Latin America. Before nationalization, it was majority-owned by Verizon Communications and traded on the New York Stock Exchange. Former employees said the company used to invest hundreds of millions of dollars a year in technology, attract top talent and pay strong salaries.
After the 2007 takeover, employees said thousands of vacant posts were filled with unqualified staff, server upgrades stopped and fiber-optic maintenance was halted. They said that has led to more frequent service disruptions.
According to the Speedtest Global index, Venezuela ranks among the worst five countries for both mobile and broadband speeds.
Internal data seen by Reuters showed that by the end of 2015, Cantv had 2.45 million internet subscribers, nearly 7 million fixed-line subscribers and almost 14 million mobile subscribers. Venezuela’s population is around 32 million.
Employees said average salaries at Cantv are now worth less than $8 a month and are often paid late. They also said workers who oppose the ruling Socialist Party are denied promotions.
Jose Maria De Viana, a former chairman of Cantv’s mobile phone unit, said the company is “frozen in time.”
Private results for the January-October 2016 period, seen by Reuters, showed Cantv could no longer fund itself. The documents said it was short 2.72 billion bolivars, then worth about $1.8 million, to meet its investment target and needed 390 million bolivars in external funds to cover the gap.
Between 2013 and 2016, payroll for Cantv’s 15,000 employees quadrupled as the government raised wages to offset inflation, according to the same report.
Two executives with access to company data, both of whom resigned in recent months, said Cantv has had to ask the central bank for money to pay staff. They also said the company is under pressure to keep fees low, at less than one dollar a month.
Current and former employees said Cantv depends on agreements with ZTE and Huawei for equipment and staff, with the Chinese firms paid in dollars from the Venezuela China Joint Fund. They added that Cantv sends employees to China for training.
President Nicolas Maduro has increasingly relied on ZTE for technology projects. Reuters reported last week that the company has played a role in developing a new smart card ID system that critics say is being used to monitor the population and distribute scarce resources to loyal supporters.
Su Qingfeng, head of ZTE’s Venezuela unit, said in a phone interview that ZTE was not Cantv’s biggest supplier and did not receive preferential treatment. A Huawei spokesman declined to comment on the company’s relationship with Cantv.
Even Cantv’s pro-government union has raised concerns. In a private letter to members last year, Fetratel chairman Jose David Mora said the company could not buy new equipment because it lacked foreign currency and was deeply in debt to Chinese firms.
He wrote that there was “total impunity for those that have bled this company dry” and said he had “zero confidence” in the current leadership. Fetratel did not respond to requests for comment.
Reporting by Angus Berwick; additional reporting by Francisco Aguilar in Barinas, Anggy Polanco in San Cristobal and Andreina Aponte in Caracas; editing by Dan Flynn, Phil Berlowitz and Rosalba O'Brien.
