Cell telephone contracts move foward to executive branch

As expected, the Superintendencia de Telecomunicaciones has recommended to the executive branch that the two participants in a spectrum auction be given concessions.

They are Claro CR Telecomunicaciones, which will pay $75 million for frequencies in the 1800 and 2100 MHz range, and Azules y Platas, which is offering $95 million for frequencies in the 850, 1800 and 2100 MHz range.

The concessions are to be for 15 years.

The executive branch now has 10 days to analyze the proposals and make a decision. If both companies are approved for a concession, the contracts go to the Contraloría de la Republica for a fiscal once over.

The money earned from the concessions will go to the Fondo Nacional de Telecomunicaciones to finance projects
of universal access, said the Superintendencia.

This is the latest step in the long-awaited opening of the telecom market to private competition. A third proposed concession did not receive bids, and it is up to the executive branch to tell the Superintendencia on how to proceed.

Azules y Platas is the local name for the Spanish firm Telefónica. Claro is a subsidiary of the Mexican América Móvil.

Both companies have said they want to be in operation before the year is out.

Costa Rican officials have expressed optimism even though they were surprised that there were not more bidders for the concessions. Firms that were eligible were those that already were well-established in other countries and had experience in setting up a cell phone system from scratch.

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