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To: Michael who wrote (394)	6/7/1999 1:26:00 PM
From: waitwatchwander	Respond to of 2737

MEXICO CITY, June 2 (Reuters) - A wireless phone company owned by Mexico's second largest broadcaster TV Azteca (NYSE:TZA - news) could lose its rights to frequencies after a court issued a temporary injunction against overdue payments for government-auctioned wavelengths, a telecommunications official said Wednesday. TV Azteca's Unefon wireless company owes the government's Federal Telecommunications Commission (Cofetel) more than $200 million for frequencies it won in a May 1998 auction, said Cofetel spokesman Elias Saad. By granting two successive payment extensions, Cofetel prolonged the payment deadline from an initial due date of October 1998 to June 15. But the court told Cofetel it could not accept late payments for frequency licenses from wireless telephone companies, Saad told Reuters. ''This (ruling) goes directly against the extensions (for payments), and directly against Unefon, because the rest of the companies paid on time (in October),'' he said referring to other companies that bid for wireless frequencies in May 1998. He said Mexico City's Ninth Administrative Court informed Cofetel of its temporary injunction last week in a case stemming from a lawsuit filed by Axtel, a wireless competitor partly owned by Bell Canada International (Toronto:BI.TO - news) TV Azteca said last Wednesday it had purchased 50 percent of Unefon for $180 million. Azteca said that money, and matching funds from another investor, would go toward paying for Unefon's frequencies, including more than $200 in principal still owed to the government, as well as late fees and interest. The spokesman for both TV Azteca and its Unefon subsidiary declined to comment on the court order. TV Azteca is Mexico's second largest broadcaster after Mexican media company Grupo Televisa, the world's biggest producer of Spanish-language TV programming. Saad said Cofetel will appear in court to defend the extensions and that the court would decide on June 8 whether to make the injunction permanent. He said the extended payment deadlines were justified because the government wants to promote the development of telephone service in Mexico and because Unefon was fined as punishment for not paying on time. Axtel filed its suit against Cofetel in April, alleging that the payment extensions that Unefon got amounted to unfair treatment and violated the rules of the frequency auction. ''The idea of an extension was not included in the auction rules. It is unfair. This treatment is discriminatory,'' said an Axtel spokesman who asked not to be named. Axtel said it is not seeking financial compensation, but more certainty for procedures within the telecommunications industry and greater respect for the rules. Axtel, Unefon and a third company, Pegaso, all plan to launch ambitious fixed wireless telephone networks in Mexico this year and next, using radio frequencies won in last year's auction. Fixed wireless phones look and operate like a conventional telephone, but the signals enter and leave the building on radio waves instead of traditional phone cables. Pegaso and Axtel both paid for their frequencies by the October deadline set in the auction.