Movistar and Claro get green light, expect delays

24 Jun 2011

New entrants into Costa Rica’s wireless market, Mexican-based America Movil and Telefonica of Spain have had their concession contracts endorsed by the Contraloria General de la Republica (comptroller’s office). America Movil and Telefonica, operating through local subsidiaries branded Claro and Movistar respectively, have three days to deposit payment for their licences. Movistar will pay USD95 million to operate in the 850MHz, 1800MHz and 2100MHz bands, and Claro will pay USD75 million for access to the 1800MHz and 2100MHz spectrums. Both contracts are for 15 years.

Claro and Movistar can begin advertising immediately, but the companies have hit roadblocks in developing the infrastructure. Unlike the incumbent, Grupo ICE, the incoming cellcos cannot build towers on public property; instead the two newcomers must erect masts on private property, and with municipal permission. Unfortunately many municipalities have no regulations in place regarding such constructions, and delays in rollout are likely.

According to TeleGeography’s GlobalComms Database, at the end of March 2011 Costa Rica had three million wireless subscribers, with population penetration at 66.9%.

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