Ecuadorian regulatory body Superintendencia de Telecomunicaciones (Supertel) – with responsibilities including spectrum monitoring/enforcement and statistical services – has presented a report analysing the mobile market’s level of readiness for introducing mobile virtual network operators (MVNOs). The report includes a wider examination of the current state of Ecuador’s regulatory and competitive framework, including recommended changes to wireless spectrum/infrastructure allocation/ownership and resource sharing rules to help improve services and levels of competition. The document from Supertel concludes that the introduction of MVNOs in Ecuador is feasible ‘in the medium term’, reports TeleGeography. Factors generally favouring the arrival of MVNOs were listed by Supertel as: the high percentage of pre-paid mobile users (nearly 86% at the end of 2012); ongoing technology standardisation (towards GSM/W-CDMA/HSPA/LTE); the rising demand for mobile services reflected in strongly improving mobile telecoms revenues; and indications that the process of reforming legislation is under way which will form a suitable stage for the entry of MVNOs.
Supertel’s report noted that Ecuador has a highly concentrated market with two dominant operators (Claro and Movistar, with 98% of subscribers between them at end-March 2013 according to TeleGeography’s GlobalComms Database), and that the introduction of a third operator (state-owned CNT’s mobile arm, the former Alegro) has so far resulted in only a marginal change to the competitive environment.
Supertel provided a detailed analysis of the potential forms of infrastructure sharing, focusing on the specific network elements that can be shared in order to identify opportunities for MVNO’s market entry. The analysis was directed at the development of regulation incorporating sharing obligations, using spectrum efficiently and other issues that would ensure an effective regulatory framework for the entry of MVNOs.
Going beyond the scope of MVNOs per se, the telecoms authority issued recommendations on improving the competitive environment including improving the efficiency of spectrum usage, e.g. referring to currently unused blocks of spectrum which are held by the existing cellcos: ‘The regulatory body shall have the power to reverse spectrum concessions that are not being used and make them available to [share with] new MVNOs [operating via the frequencies over the existing network operator’s infrastructure].’ The report noted that spectrum sharing is currently not allowed under Ecuadorian law, and that new telecoms legislation should incorporate this possibility (which should include concepts from competition law); based on this proposed legislation, MVNOs would be able to request/require operators to share their spectrum and other network resources. The report added that the International Telecommunication Union (ITU) has started a discussion regarding Ecuador on the need to use the existing spectrum efficiently, stressing that control mechanisms are essential to ensure that spectrum licensees make all necessary technological adjustments to fulfill this need. Furthermore, Supertel pointed out that at present the country’s National Frequency Plan rigidly assigns frequency bands to specific applications such as broadcasting, analogue and digital television, telecoms services, etc, and that this system must be modernised under the principles of service/technology neutrality.