Spectrum uncertainty may force Latin American telecoms to cut Capex by 67 percent, GSMA
The cut in Capex indicates that there may be significant delay in the deployment of new mobile services in Latin America.
A number of the original 2G spectrum licenses, acquired in the 1990s, are due to expire within the next five years in many Latin American countries; namely Bolivia, Chile, Costa Rica, the Dominican Republic, Panama, Uruguay and, most urgently, Colombia.
As mobile operators are unable to assume they will have the ability to renew their license at the end of its term, they may be compelled to progressively reduce investment in their networks.
The situation for Colombian mobile operators Claro and Movistar is critical as their licenses will expire on 31 March 2014 and the terms and conditions for renewal are not yet clear.
“Spectrum re-licensing must be timely and carried out in consultation with the mobile industry and in an open and transparent way. The cost of renewing spectrum usage rights should be based on achieving the best outcome for society – one which maximizes the economic and social benefits of the mobile industry – rather than on maximizing short-term revenue for government,” said Tom Phillips, chief regulatory officer, GSMA.
GSMA suggests that spectrum licenses should be granted for a minimum of 15 to 20 years to give investors sufficient time to plan their long-term investments and business strategies.
picture source: deseretnews.com
