Thirty months have passed since the Costa Rican cellphone market opened for competition, though the Costa Rican Electricity Institute (ICE) remains the country’s lone provider. In the past two and a half years, it seems nearly every progressive step taken to open the market has been met by a new obstacle.
In 2009, ICE and the Telecommunications Superintendency (SUTEL) squabbled over market entry regulations. In 2010, imprecise market guidelines frightened off potential investors.
Now, only months before telecom companies América Móvil and Telefónica are set to begin offering cellphone coverage to Costa Ricans, construction of new cell towers is causing an uproar across the country (TT, July 15).
“It is unfortunate that the opening of the cellular market is getting off to such a difficult start. It seems the effort to open the market in a hurried manner has led to badly thought-out and careless decisions,” said Fabio Masis, executive director of Info-Communications and Technology, a Costa Rican technology group. “It is not a good sign for investors, and is a sign that management is disorganized when government entities work together.”
In recent weeks, dozens of people have bombarded the Environment, Energy and Telecommunications Ministry (MINAET) and the National Technical Secretariat of the Environment Ministry (SETENA) with angry letters responding to the proposed construction of cellphone towers in their communities. Many residents say they received a letter or brochure in the mail informing them that a tower would be constructed in their neighborhood, though no further explanation was provided.
“One morning I looked at the lot next to my house and saw a sign that said Claro [América Móvil] was going to build a 60-meter cell tower next to my house,” said Natalie Lynn, a resident of Tamarindo, a beach community in the Guanacaste province in northwest Costa Rica. “I couldn’t believe it. I’ve lived here for almost 20 years and the last thing you’d want to see is that a 200-foot tower is going up right next to your house.”
Area resident Gabriela Valenzuela-Hirsch started a petition drive to ask Claro and the Costa Rican government to halt the project. The petition states that work on the Tamarindo tower didn’t comply with the General Regulations for Municipal Telecommunications License, approved by the Santa Cruz City Council. Nevertheless, the tower is till going up.
Several calls made to Claro’s national representative were not returned by press time. Nobody answered calls made to the number supplied by Claro on the flyer distributed to the members of the community.
Putting a Stop to It
Last week, Hans Kurz, a resident of Bello Horizonte de Escazú, southwest of San José, told The Tico Times that he’d received a notice from Claro informing him that a cell tower would be built in the lot adjacent to his home. Kurz said the members of his neighborhood were infuriated by the potential health risks of the tower, as well as the construction of a commercial venture in a residential area where it is prohibited.
On Tuesday, the mayor of Escazú, Arnoldo Barahona, issued a temporary halt to the construction of cell towers in the municipality.
“The mayoral office should be cautious given the lack of information about the possible damaging effects to the environment or the health of the people that are caused by these structures,” Barahona said. He added that the towers could put citizens of the municipality at risk and that an adequate health and environmental study should be conducted prior to further construction.
The community of Playa Grande, in the northwest Guanacaste province, has also seen a temporary halt in cell tower construction. According to Playa Grande resident Freda Rothermel, construction on a cell tower in the community near the entrance to Las Baulas National Marine Park was recently halted. Rothermel said that members of the community complained to several government organizations before a lawyer was hired to file an official complaint to MINAET. Soon after the complaint was filed, construction on the tower stopped.
“When we saw that trees were being taken down, we knew we had to voice our complaints immediately. We spoke to the park manager, to a lawyer and to MINAET and eventually the construction was halted,” Rothermel said. “There were so many other places that could have been selected in the community that would have been okay with everyone. No one really knows why they picked the entrance to the park.”
More Delays in Market Opening
Residents where construction has been halted are pleased that their complaints merited results, though the cancelation of tower construction projects will most likely result in a further delay of Claro and Telefónica’s entrance into Costa Rica (see Letters on Page 12).
“The dragging out of the process is depriving consumers of what they voted for with [the Central American Free Trade Agreement],” said Juan Manuel Campos, a lawyer with Ciber-Regulación Consultores, a firm specializing in telecommunications law. “They are not seeing what was supposed to be guaranteed by the free trade agreement.”
In addition to depriving consumers of provider options, Costa Rica continues to lose out on investment that is expected to accompany the market opening. According to Carlos Gallegos of the international consulting firm Deloitte, the addition of two new providers will bring in up to $3 billion in revenue during the first five years of operation, as well as an additional 2,500 to 3,500 jobs.
Costa Rica is the only Central America country that is yet to open its cellular market to competition. It has the lowest market penetration rate in the region. According to SUTEL, only 54 percent of Costa Rican residents currently have cellular plans.
In Guatemala, El Salvador and Panama, where markets opened for competition several years ago, penetration rates far exceed 100 percent. In Guatemala, the Telecommunications Superintendent reported that 123 percent of citizens had cellphones in 2010, meaning that many users have multiple phones. In Panama, more than 185 percent of residents have cellphones, making it one of the world’s 10 most penetrated markets, according to the International Telecommunication Union.
“There is no question that the market is suffering from the delays in the opening,” said Walther Herrera, an engineer at SUTEL. “But progress has been made. From here, the most important thing will be to align the government agencies, the companies, the municipalities and the communities. Will there be more delays? Maybe. But there is light at the end of the tunnel.”
No one seems to know exactly how long the tunnel might be.
