Nextel Chile was granted a mobile interconnection licence in June 2006, enabling it to operate its business under digital trunking technology. It announced that it would deploy a digital network sometime in the fourth quarter of 2006. The company has been offering analogue Specialised Mobile Radio (SMR) services in Chile since 2000.
Nextel Chile is a wholly owned subsidiary of NII Holdings, formerly known as Nextel International, the overseas arm of US wireless operator Nextel Communications. The group operates in Argentina, Mexico, Brazil, Peru, and Chile. It focuses on the corporate sector, specialising in push-to-talk services, and is notable for its low churn rates together with high ARPU. Nextel uses Integrated Digital Enhanced Network (iDEN) technology, based on TDMA and GSM architecture, combining the capabilities of a digital cellular telephone, two-way radio, alphanumeric pager, and data/fax modem.
The Nextel group began its Chilean operations in May 2000 with the acquisition of three analogue SMR companies (Comunicaciones Multikom, Comunicaciones Multitrunking, and Distribuidora Multitek) from Motorola. In August 2000, it purchased several SMR companies in Chile and Peru from Cordillera Communications Corporation. In 2001, the Chilean SMR companies were consolidated into two: Centennial Cayman Corp and Multikom.
In January 2001, Subtel confirmed that digital trunking operators could interconnect with the fixed network since they were technologically compatible. From that time, Nextel was involved in years of legal battle with the mobile telephony companies’ association – Asociación de Empresas de Telefonía Móvil (ATELMO). The mobile companies argued that the rules were being changed by authorising Nextel to become another mobile operator without having had to compete for a licence.
In April 2002, Chile’s Telecom Secretary approved Nextel’s proposal to modify and digitise its concessions, and in January 2004, Chile’s Supreme Court rejected appeals filed by Telefónica Móvil, Entel PCS, their parent companies Telefónica Chile and Entel Chile, and Smartcom PCS against an April 2003 order to interconnect with Nextel.
Finally, in June 2006, Nextel received authorisation from Chile’s Supreme Court to commence mobile operations. The company said it would start by deploying a small-scale network, which could be later expanded depending on initial results.
The delay in launching services has allowed Nextel’s rivals to launch Push-to-Talk (PTT) services first, thereby creating a competitive disadvantage for Nextel, considering that the company’s success in Argentina, Mexico, Brazil, and Peru was driven by its PTT flagship service.
See also: Chile – Mobile Market – Overview and Statistics.
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