Member Article

The main characteristic of Third Generation services (3G) is to permit voice, data and image transmissions at substantially higher speeds than traditional technologies (like 2G and 2.5G). This capability makes 3G the appropriate standard for mobile multimedia applications and wireless broadband data transmissions, allowing subscribers to be connected without interruption to the mobile web.

In September 2000, the Undersecretary of Telecommunications ("Subtel") issued a "Technical Rule for Advanced Mobile Telephony Services" (the "3G Rule"). The 3G Rule was amended in 2002.

The 3G Rule assigned the 1,710-1,770 MHz and 2,110-2,170 MHz bands to 3G services. Additionally, it established that the 1,755 MHz-1,770 MHz and 2,155-2.170 MHz sub-bands will be held in reserve until otherwise decided by Subtel.

According to the 3G Rule, only a limited number of 3G concessions may be granted, all of which will be distributed by a public auction. The 3G Rule, however, expressly provides that existing mobile telephony operators may offer 3G services through the spectrum previously assigned to them in the 800MHz and 1.900 MHz bands.

Subtel announced that it is planning to hold a public auction for the distribution of 3G concessions during the second half of 2007. However, drawing from prior experience and to clear any free competition issues in advance, Subtel decided to consult the Antitrust Court prior to drafting the corresponding 3G bidding conditions.

The main purpose of the consultation is to obtain a decision from the Antitrust Court establishing whether participation by existing mobile telephony operators in the 3G bid could lead to an excessive concentration in the mobile communications market, effectively working against free competition. In other words, Subtel asked the Antitrust Court to determine if existing operators should be invited to participate in the 3G public bid. To the extent the operators are allowed to bid, the Antitrust Court must also determine whether their participation should be subject to any restrictions.

This is the first time that Subtel is consulting the Antitrust Court prior to calling a public bid. For this reason, the market is eagerly anticipating the decision of the Antitrust Court.


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