ITU Mexican market overview
Mobile
There are four mobile networks in Mexico: Telcel (Radiomovil Dipsa SA de CV),
owned by América Móvil, dominates the market with 71% of the market share (at
the end of Q1 2010). The other operators are Movistar (Telefónica) with 21%
market share, Iusacell (Salinas group) with 4.4%, and Nextel (NII holders and
Televisa) with 3.7%.
The market could be shaken up in the near future as recent 3G1
spectrum auctions set up opportunities for existing and new players to increase
competition and reshuffle market shares. Additionally, Mexican media group
Televisa, one of the largest in the Spanish-speaking world, acquired a 30% share
of Nextel at the beginning of 2010, allowing the company to enter the mobile
market without having to build its own infrastructure. Indeed, the consortium
Televisa-Nextel won one of the three blocks of 30 gigahertz that was allocated2.
Despite the economic crisis, Mexico’s mobile sector has demonstrated strong
growth – evidenced by double digit growth in 2009 (10.9%) during a period of
decline in Mexican GDP. At the end of 2009, the country’s mobile penetration
stood at 76.2%. Despite a slowdown in growth in the first quarter of 2010,
mobile penetration is expected to exceed 80% by the end of 2010. The decrease in
growth rates can be explained partly by the already high penetration rates.
Following an increase in VAT from 15% to 16%, and a new tax of 3% on products
and services, mobile services have experienced an average price increase of 3.2%
over the course of 2009. The expected increased competition and entrance of new
players through new spectrum allocations are expected to introduce a new dynamic
to the market, and possibly a drop in prices.
Average allocation of
the spectrum (800 MHz+1900 MHz+
1700/2100 MHz) with national
coverage, in MHz, 2010
|
Operator
|
Current
|
After Tender 20
|
After Tender 21
|
Telcel
|
53.8
|
53.8
|
77.1
|
Telefónica
|
39.1
|
54.7
|
61.3
|
Iusacell
|
43.8
|
53.8
|
53
|
Nextel
|
21.9
|
23
|
52.6
|
Average
|
39.6
|
46.3
|
61.3
|
Source: COFETEL, Press release
No.52/2010, Mexico, D.F., 16
August 2010. |
Broadband Internet market
Although the Mexican broadband market has been showing high growth rates
since services were launched in 2000, there is still significant room for
growth. Fixed broadband subscriptions amounted to 9.7 million by the end of 2009
(8.8 subscriptions per 100 inhabitants), dominated mainly by ADSL (7.3 million,
or 75% of the total market). In addition, there are over 80 ISPs in Mexico3,
many operating only in certain cities or specific regions. Infinitum, the
broadband Internet service of Telmex, accounts for the highest share of ADSL
subscriptions in the country. The entrance of cable TV providers, which have
been upgrading their networks to provide high speed Internet, has lead to
additional competition in the market; by the end of 2009, cable broadband
subscriptions made up 22% of all fixed broadband subscriptions.
In many cities, especially those with relatively low income, the level of
competition remains very low, with only one or a very limited number of service
providers. To increase the availability of broadband to these regions, Mexico's
Communications and Transportation Ministry recently (June 2010) awarded a
license to allow the use of unused fiber-optic capacity from a state-run
utility, the Federal Commission for Electricity.4
New wireless broadband services will also create intermodal competition and push
further development of the Internet broadband market, especially after the
allocation of new spectrum to mobile operators. For example, the Televisa-Nextel
consortium will provide Televisa with a new platform to provide Internet
broadband services.
Local loop unbundling has not been implemented and is under review by the
regulatory authority.
Fixed line market
The demand for fixed telephone lines has been stagnating for the past five
years and started to decrease in 2009. By the end of 2009, Mexico had about 19.3
millions of fixed telephone lines and the penetration rate stood at 17.5%,
compared to 19.1% in 2008. The percentage of households with a fixed telephone
line has also decreased from 53% in 2007 to 46% in 2009. At the same time, a
growing number of households have a mobile phone. The percentage of households
with access to mobile phone has grown from 55% in 2007 to 69% in 2009.
The fixed line market is dominated by incumbent Telmex, which has about 80% of
the market. The market has seen increasing calls for increased competition, and
one of the main challenges of the regulatory authority, Cofetel, is to identify
appropriate regulatory policies.
At the same time, technological convergence is increasingly redefining Mexico’s
telecommunication market. The three main cable TV providers (Megacable, Cablemás
and Cablevisión (Televisa)) have been building their ‘triple play services’. And
through its recent entry into the mobile cellular market, Televisa will be able
to start offering quadruple play services (mobile cellular, TV, Internet and
fixed-line voice over IP).
1 In August 2010,
COFETEL, through the so-called ‘Tender 21’, awarded spectrum blocks in the
1710-1770/2110-2170 MHz band.
2 See:
3 See
4
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