Only weeks since the tender deadline, the recipients of three nationwide personal communications services licenses in Chile are almost certain, based on preliminary ratings by government telecom authority Subtel, said International Technology Consultants Inc.
Of four bids submitted, the leaders in rank order are Entel PCS, a division of Chile’s former state-owned monopoly long-distance operator Entel; ChileSat, a subsidiary of telecom company Telex Chile; and Entel Telefonia Movil, also a subsidiary of Entel.
The chief criteria for evaluating PCS candidates includes scheduled time to market, amount of coverage planned, service pricing and when parties filed their bids, explained ITC analyst J.J. Gullish. Gauged on these factors, entrants’ plans were evaluated using point values.
Subtel, or the Subsecretariat of Transport and Communications, will review and confirm its preliminary estimations. The tender deadline was Nov. 8, winners are expected to be announced formally Dec. 13 and licenses are expected to be granted in January, said Gullish.
Licensees are expected to follow the network plans and time lines stated in their bids, he added. According to stated plans, PCS should be available in the second half of next year, added Gullish.
Unlike licensing in other Latin American countries, Subtel is not charging an outright license fee. Instead, winners are required to put forth a $55 million bond to be returned if and when an operator fulfills the requirements of their license, explained Gullish. License terms have not been released.
CTC Moviles, the cellular arm of former state-owned telephone company Compania de Telecomunicaciones de Chile, was the fourth bidder. CTC recently formed a joint venture with cellular operator VTR Telecomunicaciones, called Startel, which plans to offer nationwide cellular service. Chile licensed cellular regionally, so Startel is uniquely poised to compete with the PCS licensees.
VTR is owned 51 percent by Luksic Group, a Chilean conglomerate, and 49 percent by SBC Communications Inc.
Earlier this year, a Chilean source reported that PCS licensees would be required to pay an estimated $96 million to relocate military users from the spectrum band PCS will occupy.
VTR and BellSouth Chile appealed to the court the fee was unfair.
Analog cellular was introduced to Chile in 1988, said ITC. Along with Startel, operators include BellSouth Chile and Telecom Cellular Chile S.A. Telecom Cellular initially was owned 67 percent by Motorola Inc. Partner Entel recently purchased enough of Motorola’s shares to gain majority ownership.
