Ecuador pushes carriers toward socialization

Chris Ziegler
C. Ziegler|11.25.07

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Ecuador pushes carriers toward socialization
Stung with apparently widespread, systematic technical problems on its cell networks, Ecuador's taking measures to clamp down on a pair of foreign firms that together control some 96 percent of the nation's market. Porta -- a unit of Mexico's America Movil -- and Telefonica's Movistar have been told that they've got a couple choices: either allow the government to snap up more control over the airwaves, improve reliability, and lower costs to consumers, or scram. Both carriers are due for renegotiation on their contracts, giving the government gobs of leverage. What's more, Porta's under official investigation for its service failures (for which it's facing sanctions) and has to have its network in tip-top shape by next month, so it's all just a little hairy at the moment. Officials are pressing the carriers to contribute one percent of their revenue to a fund set up to provide service to Ecuador's poor; we're certainly not professional negotiators here, but if we were Porta or Movistar right now, we might go ahead and agree to make that happen if we wanted to stick around.
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