Mexico’s 5G public sale faces restricted curiosity as a consequence of excessive charges: Report

The nation’s telecom regulator IFT initiated a public session on this 5G spectrum public sale on Might 7, 2024

Mexico’s 5G public sale faces hurdles as excessive spectrum charges deter operator curiosity, in line with a current report by GlobalData.

The nation’s telecom regulator IFT initiated a public session on this spectrum public sale on Might 7, 2024. The bidding course of is ready to happen subsequent yr and can function 600 MHz and L-Band (1427-1518 MHz) frequencies, each of that are primed for 5G providers.

Jesus Romo, analysis director at GlobalData, mentioned: “The proposed public sale combines ‘recent spectrum’ within the L-Band and 600 MHz, and ‘leftovers’ within the 800 MHz, 1.7/2.1 GHz, 1.9 GHz and a pair of.5 GHz bands, a few of which have been really licenses returned by Telefonica and AT&T as a consequence of prohibitive annual charges. The three.5 GHz band is excluded from this public sale, however Telcel and AT&T Mexico already personal licenses on this vary.”

GlobalData famous that the IFT’s choice to supply many of the spectrum in native blocks, aside from the L-Band and a single 10 megahertz block of the 600 MHz band, signifies a strategic transfer in direction of smaller geographical markets.

“This segmentation might lead to decrease spectrum charges for winners, as charges are decided by bandwidth held and protection space. Spectrum charges was a think about Telefonica’s choice to return all of its cell spectrum in Mexico. Spectrum charges is ready by the Mexican Legislative Department, with enter from the Government, and isn’t prone to be diminished within the short-term, particularly throughout an election yr,” Romo added.

The analysis agency additionally highlighted that the IFT proposed a mix of spectrum caps that take into account holdings in sub 1 GHz bands and mixture spectrum holdings per operator, that look like designed with the present market construction in thoughts. The design will doubtlessly enable native carriers AT&T and Telcel to acquire low-band spectrum to reinforce 5G protection, the agency mentioned.

“For AT&T and Telcel, the spectrum charges from the 600 MHz are prone to restrict urge for food, since spectrum charges for sub 1 GHz bands are usually superior to increased bands and can add to the annual prices of the operators,” Romo added.

AT&T Mexico is providing its 5G providers in varied cities throughout Mexico. The operator’s 5G providers are lively in Mexico Metropolis, Guadalajara, Monterrey, Tijuana, Mexicali, Ciudad Juárez, Mazatlan, Ciudad Obregon, Navojoa, Guasave, Ensenada, Puerto Penasco Guamuchil, Hemosillo, Culiacan, Saltillo, Torreon and Morelia, amongst different cities.

AT&T had initially launched 5G providers in Mexico in December 2022 utilizing spectrum within the 2.5 GHz band. The telco ended final yr with 47 cities coated by 5G know-how.

Telefonica’s Movistar initially launched 5G providers in Ciudad de Mexico, Culiacan and Hermosillo and now covers a number of Mexican cities with this know-how.

América Móvil, which operates below the Telcel model, not too long ago confirmed it reached 125 cities with its 5G community The operator presently has over 10 million 5G subscribers nationwide.

Telcel initially launched its business 5G community in February 2022 in 18 of Mexico’s largest cities, utilizing infrastructure from Ericsson and Huawei.