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Summary

Chinese telecommunication company Xinwei has started rolling out its network in Nicaragua after winning six licenses from Nicaraguan telecoms regulator Telcor to provide mobile, fixed voice, fixed broadband, pay TV, public telephony, and data transmission services. It will compete with rivals such as Movistar (Telefonica) and Claro (America Movil), established players in Nicaragua.

Xinwei aims to be tough competition for established players

After winning six licenses in 2012 to use the 1785–1850MHz spectrum band, Xinwei is nearly ready to launch its network in Nicaragua. Its fixed voice license is for 20 years, and the others, including its mobile license, are for 10 years.

The Chinese firm will offer a wide variety of telecoms services, including mobile, fixed voice, fixed broadband, pay TV, public telephony, and data transmission services. Having invested an initial $300m in developing infrastructure, Xinwei plans to operate in every section of the market, acting as tough competition to established players such as Claro, which also provides all of these services. Xinwei is aiming to switch on its mobile network by the end of 2015, later than originally planned. It plans to serve 240,000 people in the first year and has a target of 3 million subscriptions in the next two years.

Xinwei plans to use a lesser-known technology for its mobile offering: Time Division Synchronous Code Division Multiple Access (TD-SCDMA), which is unusual in the region but commonly used in China. Xinwei is known for its patented multicarrier wireless local loop (McWiLL) SCDMA mobile standard, which can provide a range of services with data rates up to 15Mbps per 5MHz channel. Although it will try to capture the market share of established players by bringing a revolution in service pricing, aiming to break the long-held Claro/Movistar duopoly in the mobile sector, there are doubts over its operational strategy and the service quality of TD-SCDMA, which could be the deciding factor as to whether it has the potential to be a main operator in the Central American country.

Appendix

Further reading

America Movil Update, December 2014, TE0001-000907 (January 2015)

Telefonica group update, January 2013, TE0001-000657 (January 2013)

Author

Amit Kumar Rai, Analyst, North America

amitkumar.rai@ovum.com

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