TEM unit returns band B in 800MHz spectrum

The Peruvian unit of Spain's Telefónica Móviles (NYSE: TEM) has started the process of returning band B in the 800MHz spectrum to local authorities, national press quoted TEM Perú general manager Javier Manzanares as saying. This was one of the conditions Peru's transport and communications ministry (MTC) established to approve the merger between TEM's two Peruvian units, which started combined operations as Movistar Perú on June 1. The company has already returned the band in 10 Peruvian cities that represent 5MHz of the total 25MHz the company has. TEM Perú plans to return the remaining 20MHz in two stages within the next 24 months. The frequencies returned previously belonged to Comunicaciones Móviles (formerly BellSouth Perú). Movistar Perú decided to return this band because it supported fewer users: 686,854 compared to 2.2 million using Telefónica Móviles' spectrum. Manzanares expects the Peruvian mobile market to grow 30% this year surpassing 6 million users. The growth should be a result of a reduction in tariffs, coverage expansion in new cities and the availability of better handsets at lower prices. Even though the company has added new subscribers, its market share has reduced to 66.4%, compared to the more than 70% that both companies had between them before the merger. "There are always ups and downs. When an operator has high penetration a 1 or 2% drop is important and even though we have added new clients we cannot maintain our share," Manzanares was quoted as saying.