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Telecom Companies Eye Costa Rican Market

Multinational telecommunication companies don t seem bothered by the fact that the Central American Free-Trade Agreement with the United States (CAFTA), which  would force Costa Rica to gradually open its state telecom monopoly to competition, hasn t taken effect here. In fact, its discussion is barely under way in the Legislative Assembly, and even supporters say Costa Rica is probably many months away from joining the CAFTA circle.

But foreign telecom companies are eyeing this market nonetheless, with famed Mexican magnate Carlos Slim leading the way and apparently, at least one satellite-phone provider already making incursions into the Costa Rican Electricity Institute s piece of the pie.

What s more, because of the nature of satellite-phone technology, there s not much the Electricity Institute (ICE), or even the provider company, can do about it. Costa Rican law states that ICE is the only entity allowed to provide telecommunication services in the country, but new technological advances apparently make the country s laws nearly impossible to enforce.

Abner Pineda, sales director for multinational firm Globalstar s Nicaraguan operation, told The Tico Times the company offers satellite phones for $900 that work anywhere in the world and can be used with pre-paid phone cards, so that a client can take, and use, the phone anywhere he or she pleases.

A report Jan.10 in the daily La R epública quoted Pineda as saying that Globalstar has various clients in Costa Rica.W hen The Tico Times asked him to confirm that information this week, Pineda said his earlier comments had been totally manipulated and that he wished to make a formal notification of my disagreement with the information that was published.

Though the company s regional Web site,, lists Costa Rica along with the other Central American nations at the top of the page, the company does not have any clients now in Costa Rica that he knows of, Pineda said, adding that because a satellite phone works anywhere in the world, there s no way of knowing exactly.

For us, it s a little delicate, he said when asked whether the company could obtain new Costa Rican clients. You could come to Nicaragua and I sell you a satellite phone I don t know where you live.

La República also published comments from anonymous business representatives who said they were Globalstar clients.Pineda told The Tico Times these must have been past clients; he said the company did knowingly have Costa Rican clients a few years ago, mostly in the fishing industry, but that those clients have stopped using the service.

We are in all of Central America except Costa Rica, he said of the company.

Globalstar s pre-paid phone cards start at $25 for 25 minutes to $250 for 420 minutes, Pineda said.Clients can also opt for monthly plans, starting at $59 for 100 minutes with each additional minute costing $0.75. When making a call, the satellite phone sends a signal to a low-orbiting satellite, which transfers the signal to other satellites until it reaches the one closest t o the intended recipient. The signal can be transmitted directly to another satellite phone; if the destination of the call is a cell phone or landline, it is transmitted through a land station.

The Tico Times contacted Costa Rica s Chamber of Information and Communication Technologies for comment on the market for satellite phones and other new technologies, such as Internet calling, but did not receive a response by press time.

Meanwhile, América Móvil, the Mexico-based telecom firm of magnate Carlos Slim, is already planning to enter the Costa Rican market once the ICE monopoly is lifted.

América Móvil, which has invested more than $1 billion in telecommunication acquisitions throughout Latin America in the past decade, is lacking only Costa Rica and Panama to gain control over the entire Central American market.I t owns part of Antel, in El Salvador; Telgua, in Guatemala; Aló Fácil and Rápido, in Honduras; and Enitel, in Nicaragua, the daily reported.The company focuses mostly on cell phones, but also runs most of Nicaragua s landline business.

Marco Antonio Slim, the son of Carlos whom the daily called the most powerful man in Latin America and who, according to Forbes magazine, is worth more than $13 billion confirmed América Móvil s interest in Costa Rica during a recent interview with La República in Mexico City.

ICE certainly has the prices to compete, according to La República.One minute of cell-phone conversation here costs $0.05, the cheapest in Central America, followed by $0.09 in Guatemala and rising to $0.32 in Nicaragua.ICE also offers the cheapest rates for landline calls, at $0.01 per minute, compared to $0.02 in Nicaragua, $0.03 in Guatemala and El Salvador and $0.08 in Honduras.

Laws to open the ICE monopoly and strengthen it for competition as required under CAFTA as well as CAFTA itself are in the Legislative Assembly but far from approval.

However, Slim appears confident these changes will eventually take place in fact, he was apparently confident more than a year ago, when América Móvil registered four of its brand names, two logos and a slogan with the Costa Rican Intellectual Property Registry, La República reported.

Last week, Slim s alleged interest in Costa Rica became an issue in the ongoing presidential campaign.U nion leaders and the Libertarian Movement Party denounced the visit of former Spanish Prime Minister Felipe González, who met with front-runner Oscar Arias here last week, saying González sought to advance Slim s interests here.A rias told Al Día the accusation is a lie and a fantasy.

González said Slim is a good personal friend but has never asked business favors (TT, Jan.27).



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