Ecuador: Cellular Concessions to Start From Scratch

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Sanctions for Telefónica and Nextel: Audit reveals deficiencies in service. La República, Peru.

El Financiero (Mexico) reports: Telefónica and Carlos Slim’s America Móvil may have to pay more to play in Ecuador when current mobile telecom concessions from the Ecuadoran goverment expire.

The decision was made as Ecuador was announcing a national telecommunications development plan for 2007-2012 (PDF).

Telefónica seems to have mightily pissed off consumers and regulators in every country it operates in.

Its partnership with the Abril Group in Brazil aside, for example, its cellular subsidiary in Mexico is headed by Francisco Gil Díaz. Who seems to have enough explaining to do about his tenure as the cabinet officer who loaded Mexican Customs with friends and relatives who got up to strange, strange doings that you would think he would be too busy to do anything else.

Are the Mercosul and Mercosul-wannabes starting to gang up on the Spaniards?

El gobierno ecuatoriano negociará nuevos contratos de concesión con las operadores extranjeras de telefonía móvil antes que renegociar los que están próximos a expirar.

The Ecuadoran government will negotiate new concession contracts with foreign mobile telephony operators rather than renegotiating those that are about to expire.

La decisión, adoptada por el Consejo Nacional de Telecomunicaciones (CONATEL) el pasado 7 de agosto, fue divulgada hoy en un comunicado por el organismo.

The decision by the National Telecommunications Council [CONATEL, the “Ecuadoran FCC”] on August 7 was announced today in a press release.

Las operadoras de telefonía móvil que operan en el país y cuyos contratos expiran en 2008 incluyen Conecel, filial de la mexicana América Móvil y Otecel, de la española Telefónica de España.

The mobile telephony operators operating in Ecuador whose contracts expire in 2008 include Conecel, an affiliate of Mexico’s América Móvil, and Otecel, owned by Telefónica of Spain.

El anterior gobierno ecuatoriano de Alfredo Palacio (2005-2007) había dicho que renegociaría los contratos vigentes desde 1993 con una duración de tres lustros.

The previous Ecuadoran goverment, that of Alfredo Palacio (2005-2007) had said it would renegotiate the contracts, in force since 1993 and good for 15 years.

It will be interesting to see what kind of vicious behavior Telefónica gets up to in order to have its way in this matter. Expect “armed media monopoly” maneuvers. That would be my idle prognosis.

The hoopla over the Telefónica-Abril deal in Brazil, for example I submit to you — it has been suggested that Abril should be forced to bid competitively on its current $0-down wireless spectrum concessions, for example — have more to do with the rising volume of its political ratfink campaigning than anything else, I tend to think.

CONATEL dijo que la opción de negociación, propuesta por el titular del organismo, Paúl Rojas Vargas, permitirá “la libertad de negociar, eliminando derechos que podrían considerarse como adquiridos por las empresas”.

CONATEL said the choice to negotiate new contracts, proposed by CONATEL head Paúl Rojas Vargas, will enable “free negotiations, eliminating rights that the companies might be deemed to have acquired.”

Squatter’s rights, in other words.

This was a major issue in the RCTV incident, I believe.

Anticipó que “los términos en los cuales se negociará los contratos son mucho mejores que el borrador preliminar elaborado” en 2006, por el antecesor del presidente Rafael Correa.

He said that “the terms under which the contracts will be negotiated will be much better than under the preliminary draft” issued in2006 by Rafael Correa’s predecessor.

El actual mandatario ecuatoriano ha manifestado varias ocasiones que el contrato vigente, en el caso de Conecel, es perjudicial para su país, en unos mil millones de dólares.

The current president has said on several occasions that the existing contract, in the case of Concel, costs the nation billions.

Recién se relevó que Conecel había declarado pérdidas en varios años, lo que le permitió pagar impuestos cero.

Recently he noted that Conecel had declared losses in various years, which enabled it to pay zero taxes.

Sobre este último punto, el titular del Servicio de Rentas Interno (SRI), Carlos Marx Carrasco, dijo que se investiga el caso.

On this point, the Ecuadoran internal revenue director, Carrasco, has said he will investigate.

The tax man is named Carrasco? Watch out!

CONATEL dijo que la negociación de nuevos contratos se iniciará después de que la autoridad “resuelva” respecto de los informes de incumplimientos contractuales, calidad del servicio y elección de veedores del proceso.

CONATEL said the negotiation of new contracts will become once it “resolves” breach of contract and quality of service issues and selects those who will oversee the process.

Esos documentos serán presentados en octubre próximo, según la propia fuente.

Those documents will be made public in October, according to the same source.

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Lagging a fairly benighted continent in every category: Some 12% of Ecuadorans have phone service. 5% have Internet service. Source: University of Santa Maria.

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