Digitel, mobile telephony company of Oswaldo Cisneros, has absorbed two regional operators: Digicel / Digital Celular (belonging to InterBank and BSCH) and Infonet (in hands of Telcom Ventures). The Venezuelan executive, former founder of Telcel-Bellsouth (now Movistar), at the beginning of the year had acquired Digitel from Telecom Italia Mobile for US$ 425mn. The new company, which will be under the brand name Corporación Digitel, will have 1.9 million clients and will consolidate as the country’s third national operator, behind Movistar (TEM) and Movilnet (Cantv). In addition to absorbing Digicel and Infonet, Digitel will be the only player with GSM networks.

Yesterday, the National Telecommunications Counsel (Conatel) and the Free Competition Protection Superintendence (Procompetencia) gave Cisneros the green light to purchase Digitel and merge the three operators. Just like, it is established in the current Telecommunications Law (Lotel). Yesterday, the head of the regulating body, Alvin Lezama, ratified in a press conference, “the application presented by the investing group Telvenco (property of Cisneros) to acquire the company Digitel as well as to merge and transfer titles has been authorized”. Both organizations highlighted the benefits of consolidating a third national operator, the elimination of roaming charges within the country and the increase of telecommunication infrastructure investments, especially in the West and East regions. 

Among Conatel`s and Procompetencia`s conditions: the expansion of fixed and mobile coverage, the development of basic and public telephony in the border and assistance centers appear. In that way, the Company will have to count on with at least a 15% fixed-mobile market share and 0.3% of public telephones. Digitel will have a 3 year term to carry out the investments and comply with the conditions set by the regulator. In a talk with Convergencialatina, the press and information coordinator of Procompetencia, Enzo Cerbino, highlighted that the organization totally agrees with the decision of CONATEL, leaving open the possibility of that in the future they may demand some type of restriction. Cerbino also stated that both organizations will request to the new company “to comply with the law and that improvements are passed on to the final user”.

According to the CONATEL “the operation to concentrate a third national operator is consistent with the policies currently developed” by the government.  Likewise, the implementation of the obligations proposed adjusts to the mission of  “socializing the use of telecommunications services and democratize its access, until transforming them into development platforms". The spokesperson of Procompetencia also agreed with CONATEL and assured, “we are headed in the right direction”. Cerbino explained, “The fact of having three strong operators instead of two, allows the user to have a larger spectrum to choose from”. However, for Procompetencia “the ideal model would be throughout Venezuela’s remote places, for example, the South or the border, and create cooperatives or small communication companies that would be able to develop those services”. According to the official, this is possible “due to Venezuela’s current model”, which facilitates small companies to offer those initiatives. Cerbino underlined, “while there are more actors within the telecommunications market, users will have more and more benefits”.