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FM AMEMBASSY BOGOTA
TO RUEHC/SECSTATE WASHDC 0690
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UNCLAS BOGOTA 003006 
 
SENSITIVE 
SIPDIS 
 
EEB/CIP FOR TFINTON; FCC FOR JGIUSTI; COMMERCE FOR 
ITA/MAC/WH/ JANGLIN 
 
E.O. 12958: N/A 
TAGS: ECPS ECON EINV ETTC CO
SUBJECT: COLOMBIAN TELECOM: VM TALKS UP SATELLITE, PLEDGES 
PROGRESS ON DISPUTES 
 
REF: 08 BOGOTA 3583 
 
¶1. (SBU) SUMMARY.  Viceminister of Communications Daniel 
Medina explained to us the benefits to governance, education, 
health, and quality of life the GOC hopes to reap by 
launching a satellite in 2012.  He expressed the importance 
the GOC attaches to a clean and transparent bidding process. 
Emboffs noted that three U.S. companies plan to bid on the 
project, which is expected to be awarded before the end of 
¶2009.  Medina noted that the newly enacted telecommunications 
law should help form the basis of resolving several pending 
disagreements between the Ministry and U.S. firms.  END 
SUMMARY. 
 
SATELLITE TO CONNECT REMOTE AREAS OF COLOMBIA 
--------------------------------------------- 
 
¶2. (U) Colombia's satellite project (Satcol) is an integral 
piece of its "Todos los Colombianos Conectados y Informados" 
(All Colombian Connected and Informed) strategy.  According 
to VM Medina, Colombia currently has approximately 24,000 
"public internet connectivity points" (including schools, 
hospitals, libraries, local governments, and military 
battalion headquarters.)  In addition to bringing 
telecommunications costs down by an estimated 30-35 percent, 
Satcol will help expand this number to 50,000 and bring 
internet and telephony to areas whose geography, climate, and 
sparse population make land-based connectivity unrealistic. 
Medina emphasized Satcol's expected role in increasing state 
presence, improving medical services, and strengthening 
social cohesion in rural (especially Afro-Colombian and 
indigenous) communities. 
 
SATCOL BID PROCESS MOVING FORWARD QUICKLY 
----------------------------------------- 
 
¶3. (U) The Ministry has released an initial draft of terms of 
reference for the approximately USD 250 million satellite 
project and will hold public meetings in the coming days to 
define risk-sharing and finalize the terms of reference.  The 
GOC has said it plans to announce the winning bid in 
November.  Colombia is looking for a 2012 launch of the 
satellite, which will remain in a geostationary orbit for 15 
years. 
 
¶4. (SBU) Three U.S. companies (Lockheed Martin, Orbital 
Sciences, and Space Systems/Loral) are expected to join 
several other international firms in bidding on the project. 
Medina acknowledged that a large bid like this one inevitably 
generates rumors as part of the competitive process.  In 
particular, he expressed concerns over: 1) potential USG 
authorizations required of U.S. companies' participation; 2) 
potential USG limitations on orbital positions if a U.S. 
company were to win; and 3) potential restrictions on basing 
the satellite control station in Colombia, which he 
characterized as a sine quo non. 
 
¶5. (SBU) Emboffs pledged to work closely with the Ministry 
and U.S. bidders to clear up any potential doubts associated 
with USG requirements so that U.S. companies would not be 
disadvantaged by misinformation or misunderstandings. 
Commercial Counselor noted some concerns over changing dates 
of public meetings and the relatively short timeframe between 
the release of terms of reference and the due date for 
bidders to translate into Spanish and submit their bids. 
Medina acknowledged the issues and pointed to President 
Uribe's interest in having the contract awarded before the 
end of the year as the reason for the short timetable. 
(COMMENT: Under a typical satellite bid, a government would 
already have its orbital slot.  The fact that Colombia does 
not is coloring the bid effort.  END COMMENT.) 
 
NEW TELECOM LAW MAY RESOLVE U.S. COMPANY ISSUES 
--------------------------------------------- -- 
 
¶6. (SBU) Medina reviewed several ongoing disputes between the 
Ministry and U.S. companies and pointed to the new 
 
telecommunications law (Law 1341 of 2009, promulgated on July 
31) as a positive step forward.  Diveo and Avantel were both 
disadvantaged by the Ministry's decision to lower the cost of 
some frequencies (used by their competitors) but not on 
others (used by these two companies).  The Ministry admitted 
in March 2009 that this was unintentional and committed to 
issue a decree remedying the situation.  According to Medina, 
having the new law on the books was required in order for the 
Ministry to submit the long-promised decree to the 
President's office.  (NOTE: Medina said (not for the first 
time) that he hoped the decree would move within 1-2 weeks. 
END NOTE.) 
 
¶7. (SBU) Medina pointed out that the new law had already 
given the Ministry the discretion to resolve another of 
Avantel's complaint -- that its license terms were more 
restrictive than those of its competitors.  Medina mentioned 
that the Ministry was in discussions with Avantel about a 
series of measures to address the company's concerns, 
including: 1) passing the aforementioned decree to lower the 
cost of the spectrum Avantel uses; 2) decreasing Avantel's 
required payment under the telecommunications tax; 3) opening 
the 2.5 GHz frequency only to specialized operators, such as 
Avantel; and 4) compensating the company for interference on 
frequencies for which Avantel had licenses. 
 
¶8. (SBU) Regarding the case of Sprint Communications, Medina 
noted that the company's formal complaint against Colombia 
Telecomunicaciones (a Spanish-Colombian joint venture) of 
unfair competition and abuse of monopoly position was 
currently before the Superintendent of Commerce (where it has 
been since January, 2009) and therefore outside the 
jurisdiction of the Ministry of Communications.  Nonetheless, 
he committed to continue to raise within the GOC the 
importance of resolving the issue. 
Brownfield