Claro Chile, a telecommunications company, has been granted provisional authorization by the Subsecretaria de Telecomunicaciones, Subtel (Department of Telecommunications) to use a part of the spectrum it already holds in the 3.5 GHz band to offer commercial 5G services, according to a statement released by the Ministry of Transport and Telecommunications.
Decision to Drive Competition
The decision was made in response to the recommendation of both the Free Competition Tribunal and the Supreme Court, which had stated that Subtel should ensure the existence of at least four operators in the market to ensure competitiveness, which will promote better prices and Network for mobile phone users.
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Claro Chile Required to Present an Invest Plan
However, before the company can start selling 5G services in this band, it must submit a technical plan similar to the one presented in the public tender of 2020 and an additional investment plan for the value equivalent to that awarded in the 2021 auction to deploy high-speed 5G mobile networks across different locations in the country that currently have connectivity problems or poor-quality mobile internet.
Provisional Approval for 5G
"As a regulatory body, we are mandated to make decisions where the national interest is paramount, such as ensuring the optimal use of the spectrum, which is a national good for public use. And this authorization, which is provisional, is taken with the objective of optimizing the use of the spectrum so that it can be operated for the benefit of citizens. When there is more competition, the plans are more attractive, prices go down, and people have more options to decide," said Undersecretary Claudio Araya.
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Claro's frequencies had previously been issued for fixed wireless use only. The decision to grant provisional authorization was made to prevent the company from gaining a cost structure advantage for not having paid money in the auction. The company must, therefore, submit a technical project and investment plan before it can start offering 5G services in the band.
According to Araya, "In a market as agile as telecommunications, we could not wait to resolve this situation that could definitively eliminate the possibility of a fourth bidder, so this decision is protecting users by maintaining competitiveness."
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The authorization is provisional, and the company will have to meet the conditions set by the Ministry of Transport and Telecommunications before it can start offering 5G services commercially. This decision aims to enhance the competitiveness of the telecom sector, allowing the entry of a fourth teleco in the band where Entel, Movistar and Wom already operate.
