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Nine Telecoms Expected To Compete For Telephone Service in Costa Rica

Telecommunications companies looking to compete with the state telecom ICE will get their permits in May or June and then have a year to set up shop in Costa Rica.

A total of nine companies are interested in offering telephone and internet services in an open market in Costa Rica, among them are Worldcomm, Amnet, Ticom, R&H international telecom and Intertel worldwide.

All have applied to the Superintendencia de Telecomunicaciones (Sutel), the newly created telecommunications regulator.

George Miley, president of the Sutel, said that the applications before them only deal with fixed line and internet telecommunications, as the Sutel is still waiting on the Minaet to offer cellular service concessions, which although the Sutel regulates telecommunications, it is the Minaet (the Ministerio de Ambiente, Energia and Telecommunications, formerly the Minae) that has the last word on the telecom infrastructure.

Miley said the Minaet is expected to provide cellular service concessions in the first quarter of 2010, when the radio frequencies licenses will be available to anyone interested in providing mobile telecommunications.

Currently there are 1.7 million cellular lines in operation by the Instituto Costarricence de Electricidad (ICE), which although it no longer holds the monopoly, is currently the only cellular service provider in the country.

The question on the minds of the companies and Costa Ricans are, what about the rates?

Costa Rica offers one of the lowest telephone rates in Central and North America. A fixed line residential phone has a minimum monthly cost of ¢2.155 colones, plus the per minute for local and international calling. Cellular service has a minimum monthly cost of ¢3.900 colones, that includes 60 minutes of local call time.

The Sutel is adamant that it will only fix the ceiling rate and leave it up to the operators to offer lower prices.

Walter Herrera, a member of the Sutel board, said that the Sutel will monitor the operators to ensure that their low rates do not negatively affect the financial position of the operator, affecting service and possibly leaving customers hanging if the company fails.

The rates are expected to be set in a meeting of the Sutel board next week.