Mexican telecoms regulator Cofetel declared the consortium the winner of a nationwide licence that aims to increase competition on the local market. According to Cofetel, the consortium offered the minimum bid price of USD 14.2 million for 30 MHz spectrum in the 1710MHz to 2170MHz frequency band in each of the country’s nine mobile operating regions. The amount must be paid to the government within 45 days.

Additionally, the tender winner will have to pay MXN 18.13 billion in annual instalments over the 20-year life of the licence. Market leader Telcel, a unit of America Movil, won 21 blocks of 10 MHz in all operating regions with a bid of MXN 3.79 billion, plus MXN 12.70 billion in other fees during the life of the licences.

Telefonica’s local unit also won six 10 MHz blocks in six regions with a MXN 1.27 billion offer, plus the agreement to pay MXN 5.43 billion in other fees. Nextel said it plans to start selling service on the new network in parts of Mexico as soon as 12 months after it gets the airwaves.

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Mikael Grahne, President and CEO of Millicom, commented: “Our customer market share continues to increase. Growth has accelerated in South America, with all three of our markets performing strongly. In Central America, although remittances have shown some early signs of recovery, we continue to face headwinds from a weak economic environment and the impact of new taxes and interconnect cuts introduced in previous quarters. We believe that this region can return to growth, driven by our focus on innovation and the major opportunity that 3G presents, given the latent demand for internet access.”

“ARPU in local currency declined further, but at a slower rate despite increasing taxes and regulation. In South America, local currency ARPU was up 2%, as a result of strong execution on 3G and value-added services (“VAS”). VAS revenues across the Group were up 29% in local currency, with non-SMS services being the main driver.”

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Pyramid believes any operator can benefit from Mobile Number Portability (MNP). For many operators, the main source of revenue growth is the acquisition of new clients, but as mobile penetration reaches high levels in many Latin America markets, finding new clients becomes more and more difficult. In these circumstances, MNP becomes an important consideration because it allows customers to churn between networks.

In a market that is reaching saturation, the best way to grow is either by stealing clients from your competitors or by taking your customers to the next level by increasing the usage of data services. MNP levels the playing field, giving all market players a relatively equal opportunity to acquire customers as it shifts the battle to a more strategic ground; this enables operators to compete with better market tools, such as service.”

Consolidated revenue rose 5.4% year-on-year in the first half of 2010 to EUR29.1 billion. Growth was stronger in Latin America (+10.2%) and Europe (+10.8%), and the recovery trend gained traction in Spain.

The company has also reiterated its guidance for the short (2010) and medium term (2012) as well as its shareholder remuneration commitment.

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Financial results for the quarter included consolidated operating revenues of $1.35 billion, a 28% increase compared to the second quarter of 2009.

The Company continued to invest in the expansion of the coverage and capacity of its networks reporting consolidated second quarter 2010 capital expenditures of $230 million, of which $122 million was invested in Brazil.

“We delivered excellent results for the quarter and the first half of the year highlighted by robust subscriber growth” said Steven Dussek, NII Holdings’ Chief Executive Officer. “These results reflect our balanced approach to growth and profitability, which is built on strategies designed to improve the quality of our customer base and customer retention across all of our markets. We have doubled our subscriber base over the past three years, while maintaining our focus on profitability with OIBDA growing 67% during that period. We believe the opportunity for profitable growth in Latin America is significant, and that our differentiated approach and the high quality of our expanding services will position us to capture this growth in the future,” he added.

NII Holdings‘ consolidated ARPU was $47 for the second quarter of 2010, up $3 when compared to the same period last year due primarily to strengthening of local currencies.

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The growth was mainly due to better operating results and synergies. Net revenues climbed to BRL 7.39 billion, compared to a pro forma BRL 7.30 billion a year earlier.

The company ended June with 62.55 million subscribers, adding around 310,000 new subscribers in the quarter and 2.7 million users since June 2009.

The growth came mainly from the mobile telephony base, which added 613,000 users in the quarter and 3.3 million customers in 12 months, for a total 37.22 million customers at end-June.

Over the past 12 months, the mobile base was up 9.7 percent. The number of fixed broadband customers also increased, by 1 percent from March and by 5.9 percent from a year earlier, to a total 4.307 million.
Including 68,000 new 3G mobile broadband users, the total broadband increase was 556,000 customers.

The fixed telephony base fell to 20.759 million lines in service at end-June, from 21.085 million in March and 21.753 million in June 2009. Fixed-line ARPU declined to BRL 55.2, from BRL 55.5 in Q1, while mobile ARPU increased to BRL 22.4, versus BRL 21.8 in March 2010 and BRL 21.0 in June 2009.

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Local and long distance telephony revenues fell by 10 percent and 13.9 percent, respectively, while interconnections revenues dropped 9.9 percent, and data revenues increased by 12.2 percent year-on-year.

Operating revenue for the three months to June fell to MXN 6.86 billion, from MXN 8.49 billion in the second quarter of 2009. Net profit plunged 39.7 percent to MXN 3.57 billion.

Telmex lost around 1.7 million users in the quarter, reaching 15.7 million active lines at end-June. The operator won 183,000 new ADSL customers in the period, serving around 6.95 million broadband users at end-June. Telmex served around 105,000 dial-up internet users at the end of the period, down 34 percent from 159,000 customers in June 2009.

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The company claims that number is almost twice as many new customers as the main direct competitor, Net Servicos.

Telefonica Brazil estimates investment in its network and systems at BRL 930 million this year, compared to BRL 750 million last year. From 1 August, Telefonica will reduce the price of the 2 Mbps internet access package by 11 percent to BRL 69.

Telefonica Brazil claims 23 percent of the broadband accesses in 13 million households in Sao Paulo.

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The company claims that number is almost twice as many new customers as the main direct competitor, Net Servicos.

Telefonica Brazil estimates investment in its network and systems at BRL 930 million this year, compared to BRL 750 million last year. From 1 August, Telefonica will reduce the price of the 2 Mbps internet access package by 11 percent to BRL 69.

Telefonica Brazil claims 23 percent of the broadband accesses in 13 million households in Sao Paulo.

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The consortium offered the minimum bid price of MXN 180.3 million for 30MHz in the 1710MHz to 2170MHz frequency band in each of the country’s nine mobile operating regions, the Mexican telecoms regulator Cofetel announced.

Televisa  plans to invest USD 1.44 billion for a 30 percent stake in Nextel Mexico if the partners obtain enough spectrum to deploy a 3G network.

Cofetel declared the sale of a second nationwide license deserted. The requirements imposed by the Federal Competition Commission meant that only Televisa-Nextel could bid for one of the two nationwide licenses.

América Móvil, S.A. offered MXN 3.79 billion for 21 blocks of 10MHz in all operating regions. Telefónica Móviles México offered MXN 1.27 billion for six 10MHz blocks in six regions.

Cofetel is expected to announce the tender winners within the next 30 days. A separate auction of blocks in the 1850MHz to 1990MHz frequency band ended on 18 July, with combined bids reaching MXN 2.98 billion.

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Nicaragua is expected to grow at a CAGR of 6.5 percent over the next five years to advance from $478 million for 2010 to $655 million in 2015, well ahead of the 3.7 percent average expected for Latin America, notes Jose Magana, Senior Analyst at Pyramid Research. “In Central America, the growth rate in Nicaragua will be the fastest of all countries due to its still-early stage of penetration in mobile services and our expectation for growth even in the fixed sector,” he says.  

Mobile penetration in Nicaragua will close at 53.9 percent in 2010, the lowest in Central America. “The low competitiveness of the market, with just two mobile operators, paired with the lowest income in the region curbs the adoption of services,” Magana explains. “There is still a large percentage of the population underserved; by the same token, experiences in Africa with mobile payments and health initiatives prove that there are opportunities for operators if services targeting the bottom of the pyramid succeed,” he adds.  

“We forecast that mobile penetration will reach 82 percent by 2015, driven by expansion of prepaid subscriptions and urban mobile broadband connections,” says Magana. Prepaid subscriptions account for 94 percent of total mobile connections, in line with Nicaragua’s Central American neighbors.

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“The Intec solution brings us a reliable and flexible system for expanding our operations and easily addressing the challenges of the forthcoming number portability requirements. Intec offers a proven solution that enables us to bridge our interconnection operations with other areas of our business,” said Robinson Luengo, Entel Financial and Interconnection Manager. “Intec understands the challenges and requirements for business growth and maximising revenues from interconnect agreements as evidenced by similar implementations throughout Latin America.”

The deal fell through after Portugal Telecom’s board of directors failed to accept the Spanish company’s offer by the deadline.

“The deal has been extinguished,” Telefonica said.

Though PT shareholders voted two weeks ago to accept the offer, the Portuguese government used special voting rights to block the sale, citing national interests.

The European Union’s Court of Justice then ruled that the Portuguese government’s blocking of the deal was illegal.

Portugal Telecom is Portugal’s largest telecommunications operator and the Portuguese government demanded it maintain a foothold in Brazil as it did not want to lose Portugal Telecoms’s Brazilian revenue stream.

Telefonica would not comment Saturday on the possibility of legal action following the collapse of the deal.

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“This ends July 16,” Chairman Cesar Alierta told Bloomberg News. “Brasilcel is a relationship between Portugal Telecom and Telefonica and as far as I know there is no need for anybody else to interfere.”

The two phone companies jointly own Brasilcel, which controls 60 percent of Vivo Participações (VIVO) . Telefonica originally offered EUR 6.5 billion (USD $7 billion) for the Brazilian stake, but later raised it to the current EUR 7.15 billion (USD $9 billion).

Telefonica will go to a Dutch arbitration court to seek the breakup of Brasilcel if it can’t reach an agreement this week, Spanish newspaper ABC reported today, citing people close to the phone company’s board it didn’t identify. In the event that Brasilcel were broken up, Telefonica would seek to buy shares in Vivo in the open market until it reaches majority control, ABC added.

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The Company purchased 113 of these tower sites, on which Telefonica Chile S.A. is the anchor tenant, at an initial closing on June 29, 2010, and expects to close on the remaining sites by the end of 2010, subject to customary closing conditions.  

“Consistent with our strategy to expand within select Latin American countries, our launch of operations in Chile extends our presence into a vibrant wireless market where recent spectrum auctions are expected to drive investment in network expansion by existing wireless carriers as well as new entrants,” said Jim Taiclet, Chairman, President and Chief Executive Officer. “We have the people, systems and processes in place to support our operations in Chile as we work to establish our local market presence. In addition, we will further leverage our existing regional operations as we continue to pursue opportunities for future expansion and investment”

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According to figures from the Mobile World analysts, the company had 432,000 subscribers at the end of March 2010. This represented a market share of 7.3%.

The company aims to help boost the subscriber base by providing free SIM cards to its 360,000 landline customers, and expects to be able to convert around 100,000 into paying subscribers. In addition, the goal is to reach 1 million landline subscribers between basic and fixed wireless for the five-year period beginning in 2008.

Although the government hasn’t confirmed the price paid, local media reports suggest that it was in the region of just US$3 million. Hola Paraguay was 70% owned by Japan’s KDDI Corp.

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Telefonica has now boosted its previous EUR 6.5 billion offer by 10 percent. The new consideration amounts to EUR 7.15 billion and is valid until 2 July. All the other terms and conditions of the previous offer launched on 1 June remain the same. The revamped offer will be submitted to Portugal Telecom shareholders at the general shareholders meeting on 30 June.

Telefonica had already increased its initial EUR 5.7 billion offer by 14 percent to 6.5 billion on 1 June to gain support from Portugal Telecom Shareholders. Portugal Telecoms board unanimously rejected Telefonica’s previous offers, claiming that the bids did not reflect the strategic value of the asset for Telefonica.

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“The government has oriented Caixa Geral de Depositos to vote against [Telefonica's bid] at the Portugal Telecom shareholder assembly, that is the government’s position,” said Socrates. According to the prime minister, “for the government, the strategic interest of the country is for Portugal Telecom to have a large dimension and scale”.

Caixa currently holds a 7.3 percent stake in Portugal Telecom. Two other Portugal Telecom shareholders, namely Banco Espirito Santo and investment fund Ongoing, have recently announced they will oppose the sale at the 30 June meeting.

On 30 June, Portugal Telecom shareholders will discuss and vote on Telefonica’s EUR 6.5 billion offer for Brazilian joint venture Vivo Participações (VIVO).

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