Venezuela Spectrum Auction To Favor Incumbents - Minister

CARACAS -(Dow Jones)- Venezuela's upcoming mobile spectrum auction will favor the three incumbents, Telecommunications Minister Jesse Chacon said Thursday.

"We want to favor those that can carry out the fastest rollout," as the existing network has shown signs of reaching capacity, Chacon told reporters following the presentation of the auction process.

Nevertheless, the process "is open for additional companies to participate," he added.

Currently, three companies operate in the South American country, including state-owned CA Nacional Telefonos de Venezuela, or CANTV, whose Movilnet unit holds a 40.8% market share; Telefonica SA's (TEF) Movistar, with 41.6%; and closely-held Digitel with 17.6%. "All current operators will enjoy equal opportunities" in the spectrum tender, Chacon said.

At the end of the second quarter, cellular market penetration totaled 77.1%, jumping from 58.5% a year earlier, Chacon said.

That has led to bottlenecks in voice traffic and text messaging, prompting the move to tender the 1700, 1800 and 1900 megahertz wavelengths, Chacon said.

Participants in the auction will have until Sept. 10 to submit their bids, and Conatel will announce the winners Oct. 22.

- By Stephan Kueffner, Dow Jones Newswires; 58-212-564-1339; stephan.kueffner@dowjones.com

(END) Dow Jones Newswires"

Posted to the site on 26th July 2007