Senatel to Initiate Talks to Renew Mobile Concessions Next Week

Ecuador's telecoms sector administrator Senatel expects to start officially negotiating next week the renewal of concession contracts of mobile operators Porta and Movistar that expire in 2008, local newspaper La Hora reported Senatel's head Jaime Guerrero as saying.

According to the report, Senatel expects to reach an agreement with the operators by the end of this month. Senatel officials have held informal meetings with representatives of the two mobile operators during recent weeks, Guerrero said.

The concession contract of Porta, a unit of Mexico's América Móvil expires in August while that of Movistar, owned by Spanish operator Telefónica, lasts until November.

The duration of the renewal period will be an area of debate in the negotiations as operators are seeking an additional 15 years while the state has said it is offering 10-year contracts, according to the report.

Mobile telephony rates and the price operators should pay for the new concession contracts are also to be decided. The government is also likely to include rural coverage obligations as a clause of the new contracts.

Senatel also wants to include a clause allowing periodic revisions of the terms of the concession contracts.

Porta is currently under investigation by telecoms authorities for alleged negligence regarding a technical problem that occurred on September 25 and could face sanctions as severe as the cancellation of its existing concession contract.

Posted to the site on 14th December 2007