Panama to Auction Cellular Licenses

Reuters reports Panama will auction two new cellular phone licenses to encourage competition, improve service and lower prices. Minimum bid will be $36 million each.

The contracts will be awarded in March 2008, with the pre-qualification period already under way. A government spokesman declined to address whether the incumbent companies, Britain’s Cable & Wireless and Spain’s Telefonica, will be allowed to bid on the added licenses.

According to government figures, Panama has 2.4 million mobile phone users and just over 3 million inhabitants. Some industry observers question whether that market can support two more companies.