U.S. government loosens rules on telecom services for Cuba

The Obama administration has lifted many of the embargo constraints on Cuba for American companies providing telecommunications and broadcast services. Under the new policy announced Monday, U.S. companies can establish fiber-optic and satellite links to the island nation 90 miles away from Florida, as well as negotiate cell phone licensing agreements - but will they?

Americans will be able to send Cubans cellphones, computers, software, and satellite receivers, said the White House. They will also be able to pay for Cubans' telecommunication charges if service is provided by U.S. or third-country companies. Radio and TV satellite companies can also provide service directly to Cuban citizens now.

U.S. carriers, however, are being cautious about the change, since the Cuban government would also have to sign off on services, such as roaming agreements, landing rights for fiber optic cable, and issuing licenses. There's also the matter of a lack of available disposable income for the average Cuban citizen, but U.S. relatives could cover the costs for their island cousins in theory.

According to statistics released by the ITU in 2007, 11 percent of Cuba's population subscribes to telephone services, and only 2 percent subscribes to cell phone service. Fewer than one in 100 Cubans is a broadband subscriber, but 12 percent of the population uses the Internet - typically by bumming a session at one of the tourist hotels.

The biggest boom in the new policy could be with satellite TV and radio companies, which could potentially easily provide service; Sirius XM Radio could be a potential winner.

For more:
- The Miami Herald discusses the change of policy. Article [1]. So does the LA Times [2].