By Ken Parks
BUENOS AIRES--Argentine President Cristina Kirchner has approved
the construction of a state-controlled mobile network aimed at
increasing competition in the wireless telecommunications
industry.
In a decree published Monday in the Official Bulletin, Mrs.
Kirchner ordered state communications company Arsat to take those
steps necessary to build a "federal wireless network" to complement
a nationwide fiber optic network that is under construction.
In September, the government canceled a 3G spectrum auction that
attracted bids from the country's four mobile operators and instead
handed the spectrum to Arsat.
Arsat, whose main focus up until recently has been extending
digital-television service to remote areas, now has 20% of
Argentina's available 3G spectrum.
The company has been seeking partners to help it build and
operate its own wireless network.
Argentina boasts one of the highest rates of mobile-phone
ownership in the world, with about 55 million wireless accounts in
a country of almost 41 million people.
The swift uptake of wireless data services coupled with the
government's reluctance to issue more spectrum to carriers has led
to service quality problems.
Gaps in data coverage, dropped calls, or the outright loss of
wireless coverage are common in the capital city of Buenos Aires
and the surrounding urban area.
If successful in building its own wireless network, Arsat will
compete with units of incumbent operators Telecom Argentina SA
(TEO, TECO2.BA), Mexico's America Movil SAB de CV (AMX, AMOV,
AMX.MX), Spain's Telefonica SA (TEF, TEF.MC) and U.S.-based NII
Holdings Inc. (NIHD).
-Write to Ken Parks at ken.parks@dowjones.com
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