Entry of new mobile operator unlikely - Viva

- Thursday, June 9, 2011

Entry of new mobile operator unlikely - Viva

The entry of a new player in Bolivia's mobile telephony market is very unlikely, local mobile operator Viva regulations head Mauricio Fernández told BNamericas.

It would even be difficult for local telecoms cooperatives to enter the mobile market due to the high investments required, he said. "Local cooperatives, grouped in the Fecotel association, intend to offer mobile telephony due to the fact that revenues from fixed voice services are declining. They have the right to plan this, but I don't think it's very feasible for them since they lack the financial resources needed to finance a mobile operation."

And there is little room in the local mobile telephony market for a fourth operator, Fernández added. "Current mobile penetration is approximately 60-70%. However, the market is saturated in the country's urban areas, which offer higher profitability."

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Bolivian telecoms cooperatives are working to develop a joint project to offer mobile telephony services, La Paz-based cooperative Cotel's planning manager, Delfin Mejía, previously told BNamericas. Mejía said the cooperatives are working on a joint project to deploy infrastructure to provide mobile telephony.

If the government greenlights the project, mobile telephony services could be launched across Bolivia in two years, Mejía said at the time. Cooperatives expect the government to award the spectrum free of charge due to their social importance in the country.

Current mobile operators in Bolivia are Viva, state-owned Entel Móvil and Telecel, of Millicom International Cellular (Nasdaq: MICC), which operates the Tigo brand.

Bolivia's congress is currently studying a new telecoms law. The bill, which has 130 articles, considers telecoms services of public interest, subject to government regulation and control. The bill also looks to guarantee efficient use of spectrum for telecoms services.

Viva - majority owned by US mobile holding company Trilogy International - expects this year to deploy 3G network infrastructure in Oruro, Sucre, Tarija, Potosí, Pando and Beni, building upon already existing infrastructure in the cities of La Paz, Cochabamba and Santa Cruz, company regional manager Pilar Soria previously told BNamericas.