Costa Rica to OK mobile providers by September

January 15, 2010

The sluggish opening of the cellular phone market in Costa Rica continues to be prolonged, but it appears an official plan of action is now in place. If all goes according to the timeline laid out by the Superintendent of Telecommunications (SUTEL) on Monday, three new cell phone competitors will enter the market, offering service plans and coverage, by the first quarter of 2011.

SUTEL officials announced the timetable and explained how new providers can gain entry to the market and begin operations during a public forum held at the Hotel Real Intercontinental in Escazú, west of San José.

Companies such as Digicel, Millicom, Telefónica, Cable & Wireless and América Móvil are interested in bidding to offer cell phone service, according to SUTEL.

A host of potential competitors have been vying for entry in since last January, when Costa Rica entered the Central American Free Trade Agreement with the U.S. (CAFTA), breaking up the long-standing monopoly to offer telecommunications services held by the Costa Rican Electricity Institute (ICE).

In February, SUTEL was created to serve as the regulatory body, tasked with setting up appropriate guidelines to usher in the new era for the Costa Rican mobile industry.

International mobile providers continued to pose one question to SUTEL: “When can we enter the market?”

It appears that question was finally answered Monday.

“This is the beginning of the process of granting approval into the mobile telephone market in the country,” said George Miley, the president of SUTEL. “We believe that in September we will be giving approval to the country´s new operators.”

Miley went on to detail the timeline for entry, starting Feb. 5, when SUTEL will begin accepting bids. Using what Miley referred to as a “hybrid auction,” for three months SUTEL will review the technical and financial plans of the companies vying to compete. On April 20, SUTEL will send a list of three approved companies to the Executive Branch for review. If approved, Costa Rican President Oscar Arias will sign the agreement on May 5, three days before the conclusion of his presidential term on May 8.

SUTEL said only four companies, ICE included, will provide cellular coverage in Costa Rica, at least in the early years of the open market. Once approved, the other three companies will gain access to Costa Rica´s air waves for 15 years.

See the Jan. 22 print or digital edition of The Tico Times for more on this story.

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