Mexican state-owned company CFE Telecomunicaciones e Internet para Todos (CFE-TEIT) this week presented its new mobile phone service for the country.
The subsidiary of public power company CFE will offer mobile telephony and mobile broadband in areas where there are currently no services, leveraging the network of 47 Telecomm branches to market these products.
CFE-TEIT will be non-profit and will rely on Altán’s shared network, in which the government recently invested to pull it out of bankruptcy.
As of February 5, 2021, the shared network covered 63,948 localities in the country and by some time in 2024 it should cover 92.2% of the population.
Meanwhile, CFE-TEIT will deploy its own infrastructure to cover the remaining 7.8% of the country.
The CFE-TEIT concession makes it possible to offer telephony and mobile internet services in nearly 130,000 remote locations across Mexico.
The company offers prepaid packages with costs ranging from 30 pesos (US$1.50) for three days’ service and up to 300 pesos for 30 days, as well as plans under contracts priced at between 400 and 2,100 pesos per month, with automatic renewals every six months or annually.
INVESTMENT
Last week, President Andrés Manuel López Obrador (AMLO) stated that his government would make investments of 30bn pesos to take internet services to the entire country.
However, it is not yet clear exactly where this money will be spent, although some of it will certainly go on bolstering the Altán network.
The sum mentioned by the president could also include subsidies for CFE services or social plans, since AMLO stated that he would also use the Bancos de Bienestar, or welfare banks – the arm of the government through which these plans are organized – to distribute SIM cards , Telconomía analyst Jesús Romo told BNamericas.
“In September, when the budget is ready, we will have more clarity. To put it into context, we should take into account that 30bn pesos is practically double what the operators pay annually for spectrum rights,” added Romo.
In Mexico, payments for spectrum rights are one of the main costs for telecommunications operators. While at the regional level the annual fees represent an average of 20% of the total cost of the spectrum, in Mexico that figure is 85%, according to GSMA figures.
In September, CFE-TEIT announced that it would invest 15.5 billion pesos in two nationwide connectivity projects.
The first involves the development of the 4G mobile network to take services to some 6mn Mexicans in 26,000 areas, including 173 municipal capitals, where the technology is not present or insufficient. The capex assigned to this initiative is 8.71 billion pesos.
It is estimated that CFE will have to deploy some 2,500 antennas.
The second project entails a national “aggregation” network, that is, illuminating backbone infrastructure that can connect users to a provider with available coverage in a given geographic area, which is expected to cost 6.85bn pesos.
CFE currently has more than 1,000 km of dark fiber optics.
MARKET
The ICT market in Mexico generated revenues of 136 billion pesos in the second quarter of the year, 4% more than in the same period of 2021, according to figures from the consultancy The CIU. Mobile telephony accounted for 59.2% of this amount.
Telcel has the largest number of lines in service, with almost 61.5% of total mobile subscriptions, followed by Movistar (17.3%), AT&T (15.6%) and the MVNO segment (5.6%).
Virtual mobile operators (MVNO) are currently driving the growth of the sector, with a 79.8% increase in the number of their lines in the second quarter, according to the consultancy.