ETECSA Admits Fraud Losses from Overseas and Acknowledges Mobile Service Issues

The authorities of the Cuban regime have coined the latest euphemism to describe the widespread crisis in the country. They call it a “complex scenario,” and it also affects the state's telecommunications monopoly. The Empresa de Telecomunicaciones de Cuba S.A. (ETECSA) admitted that the “situation is complex” but that they are “constantly seeking solutions” to improve their voice, data, landline, and home internet services.

According to Juventud Rebelde, the commercial vice president of ETECSA, Lidia Esther Hidalgo Rodríguez, stated that “the current financial situation for the company is unfavorable regarding the acquisition of fresh foreign currency.” She explained that the state-owned company faces “growing fraud phenomena, with websites cloning the identity of ETECSA and creating very attractive recharge options from abroad using national packages.”

Hidalgo Rodríguez elaborated that the end user receives a message with their recharge sent from a private number that does not belong to ETECSA but to illegal intermediaries operating from abroad. The money involved in these operations does not reach the company. According to her, the diversions due to this issue amount to millions of dollars.

Impact of the U.S. Embargo

However, the “complex scenario” has other facets affecting the company's balance sheets, chaired by Tania Velázquez Rodríguez. The "blockade" by the United States is a recurring argument for the company under the control of the Grupo de Administración Empresarial S.A (GAESA), managed by the Cuban military.

Ninety percent of the technologies used by ETECSA are imported, Hidalgo Rodríguez explained. In this regard, the effects of the U.S. embargo further increase the prices of these technologies, making “the financing required to guarantee operations complicates the sustainability of the country's telecommunications system.”

“The financial situation does not allow us to expand investments,” admitted the commercial vice president, acknowledging that the country's 3G network is saturated. She also pointed to the obsolescence of infrastructure (mainly cables and street cabinets) as one of the main causes of the “growing saturation” faced by the landline network.

ETECSA records an average of 16,000 daily interruptions in this service, most of them in the capital, some lasting more than seven days. This technology requires many components, all of which are imported, Hidalgo Rodríguez explained.

Investments in fiber optics are needed to transition to another level for the 1.5 million landlines in the country. At the same time, higher levels of damage are recorded in the public network due to trash burning under telecommunications cables, a problem associated with the uncontrolled proliferation of garbage dumps in the country.

“Additionally, the national electro-energy situation has impacted sites that have been left without electrical backup. Currently, approximately 450 radio bases are interrupted daily for this reason, along with a considerable number of landline services,” reported the cited medium, acknowledging that due to continuous and prolonged blackouts, generators remain on for extended periods, causing many of these units to experience “affects.”

In the short term, the outlook is bleak for ETECSA customers. The company declares itself focused on improving and optimizing the telecommunications network based on available resources. The lack of supplies to replace broken Nauta Home modems or to install alternative landline equipment (known as TFA) are some of the “problems” the company faces. Additionally, Hidalgo Rodríguez noted that there is also a deficit in replacing already used SIM cards (not for new ones).

As of today, according to state company data, the country has 5,684 radio bases, 1,300 of them with 4G technology, the latter in high-density areas covering 50 percent of the population. This is complemented by 280,000 homes with Nauta Home and 7.8 million mobile lines, 158,000 of them added in the first four months of this year, and 7.1 million provisioned for internet access. From 2020 to date, this represents a growth of 1.7 million lines.

Internet Restrictions Amid Protests

What ETECSA does not mention: The internet blockade to hide protests and repression. “Metrics show that communication platforms like WhatsApp, Facebook, Instagram, and some Telegram servers are being blocked by ETECSA,” indicated the NetBlocks platform following the historic protests of July 11, 2021 (11J).

Findings from this global internet monitoring platform corroborated user reports on service interruptions. NetBlocks specified that ETECSA is “the only telecommunications company in Cuba, government-owned, and also operates the Cubacel cellular network.”

Social media has become the main tool for denouncing and testifying by Cuban civil society, which, following the 11J protests, has become one of the primary sources of citizen journalism in Cuba.

“NetBlocks network data confirms the partial interruption of social networks and messaging platforms in Cuba from July 12, 2021. Specific restrictions likely limit the flow of information from Cuba following the widespread protests where thousands demonstrated against the government,” NetBlocks indicated.

This was not the first time NetBlocks confirmed a widespread internet outage in Cuba. In late November 2020, the independent organization denounced the partial interruption of social networks in Cuba during protests related to the 27N and the San Isidro Movement (MSI).

In late November 2022, a massive internet outage affected more than 70 percent of network traffic in Cuba during the early morning hours before the start of municipal elections on the island. Reports from Cuba indicated that the blackout extended throughout the night.

After spending "the entire night without communication," Cuban activists labeled the event as "state terrorism," suspecting it was a strategy to prevent the opposition's planned boycott of the elections and intimidate the population.

These interruptions have become a common strategy whenever there is discontent with the regime to avoid a domino effect of new protests. For example, internet outages were verified in July 2022, following demonstrations in cities like Holguín, Los Palacios, and Nuevitas. It is also a usual practice with activists and opponents who fall victim to this form of censorship.

Following the popular protest in mid-March in the city of Santiago de Cuba (17M), users reported internet service cuts. As soon as the first videos of the demonstrations appeared, people inside and outside Cuba reported connection problems, while others claimed that there were total interruptions by the Cuban state telecommunications monopoly, ETECSA.

The disruption extended for days in some areas of the eastern city, where users reported new internet cuts, while others managed to connect with difficulty, mainly from homes, using the Nauta service and some type of VPN. In other Cuban cities, such as Sancti Spíritus, Holguín, and Pinar del Río, problems like slow access to social networks have also been reported.