The Mexican government’s efforts to increase competition in the wireless market have suffered a setback.
Last summer the country’s communications minister announced plans to salvage spectrum in the 2.5GHz band from media conglomerate MVS…
The Mexican government’s efforts to increase competition in the wireless market have suffered a setback.
Last summer the country’s communications minister announced plans to salvage spectrum in the 2.5GHz band from media conglomerate MVS Comunicaciones, which it could then re-auction for 4G.
However, according to local reports Mexico’s supreme court has upheld an appeal by MVS to keep hold of the high-frequency licences. MVS has 42 of the 68 2.5GHz licences, a band commonly used across the world for 4G. Its broadcast arm used to use the frequencies for television but that was freed up when it moved to satellite TV. Subsequent attempts by MVS to build a wireless network and utilise the spectrum have fallen through, and so the government is looking to put the valuable frequencies to use elsewhere.
Mexico is in the process of reforming the telecoms sector with plans to create a beefed up regulator to foster greater competition. Carlos Slim’s America Movil currently dominates the mobile and fixed-line markets. Auctioning MVS’ spectrum for wireless operations would allow a new players to challenge that dominance.
For MVS the licences are a valuable asset and it launched a court battle to keep them last year. The company has previously said the government had promised to renew its licences in exchange for it not contesting Televisa’s acquisition of a 50% stake in Grupo Salinas-controlled operator Iusacell; a claim the government denied.
When the repossession of the spectrum was announced the head of Mexico’s antitrust regulator, Eduardo Perez Motta, said he hoped the government’s decision to reclaim 2.5GHz spectrum did not lead to years of court battles. He expressed concerns that a protracted legal battle would keep the band out of the hands of a new player that could challenge the status quo. The litigious nature of the sector is a key reason why the Mexican market has not evolved following privatisation in the manner that many other countries have.
