Chile's Telefonica Slashes Mobile Phone Investment, Diario Says
By Michael Smith
Santiago, Dec. 26 (Bloomberg) -- Chile's No. 1 phone company, Telefonica CTC Chile, will
slash spending on mobile phone business next year on concern a new provider will enter the
market, heating up competition, El Diario reported.
Telefonica Movil plans to invest about $65 million in 2001, down from $150 million this year,
Chief Executive Jose Pascual Moles told the financial daily. Telefonica's biggest concern is that
Nextel Communications Inc. will enter the mobile phone market by taking advantage of radio
frequencies it now has the right to use, Moles said. Nextel would be the fifth competitor in
Chile's already crowded mobile phone market.
Telefonica Movil expects to increase its subscribers to 1.5 million in 2001, from about 1.2
million this year, Moles said. Telefonica Movil is the biggest mobile phone company in Chile,
with about 40 percent of the market, Moles said.
Last year, Telefonica Movil eliminated 450,000 customers who had past-due accounts or
weren't using their phones, Moles said. At the same time, the company added about 500,000
new customers, he said. Telefonica CTC Chile recently announced plans to halt investments in
new fixed phone lines, reversing a 10-year buildup that gave Chile one of Latin America's best
telecommunications networks. |
