Once the purchase process for 99% of Enitel was completed in 2004, the next goal of America Movil will be to merge main local networks to consolidate its dominant position in Nicaragua, face market opening, and absorb the impact of Telefonica Moviles¿ arrival. The Spanish firm has given out energizing signals for the acquired branch of BellSouth.

In addition to the State-run firm, America Movil controls Aló PCS Digital in the country. A merger between Enitel and Aló PCS may allow America Movil to cut costs and rates. Independently, each of the operations has to pay US$ 350,000 a year for the use of the frequency, plus 3% of the gross revenues for band exploitation.

However, the current Telecom Act sets forth “in no case shall there be a sale, transfer, or mortgage on a license, permit, or authorization and rights granted thereof, nor liens or transfers on them”.

Lucía Martínez Muñoz, in charge of Press and Public Relations in Telcor, told Convergencialatina “if completed, the merger may be subject to in-depth analysis on the part of the regulator, mainly to prevent anti-trust acts”. Telcor¿s spokesman held “There is the possibility that both firms act jointly without being merged”.

America Movil relies on the possibility that a change in the setting may also bring about changes in its situation. To date, it was able to halt market opening in December, and got Enitel to maintain international long distance and basic telephony exclusivity, at least along 2005. Enitel requested an extension to try and merge or change the goal of Aló businesses, and made the legal claim be heard in the Court of Appeals. This intention of gaining time has its grounds: Slim¿s firm is waiting for the approval of the Law for the Utilities Superintendent, to create a new regulator to get some of the powers currently under Telcor.

Currently, the law is under the assessment of the “Special Commission for National Dialogues” made up of representatives of the Liberal and Sandinismo caucuses, main political forces in the country. Talks may be advanced and there may be an agreement in most of the articles for the creation of a new regulator, which may be executed in the incoming days. Under this new legal setting, America Movil may be able to concentrate some 452,000 mobile subs added in Nicaragua, among the clients of Enitel and Aló, to stand up for the struggle with BellSouth. The unit of Telefonica Moviles totaled some 286,000 clients to December. Competition between the two giants was even tougher, as, this week, Telcor equalled the rate scheme of Enitel and BellSouth, to cut costs for fixed calls to mobile networks under BellSouth, from US$ 0.29 to US$ 0.15.