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Mexico to Establish Telecom Investment Promotion Agency

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Mexico is set to establish the Telecommunications Investment Promotion Agency through a presidential decree. The agency will be responsible for the installation of the government’s proposed shared network and provision of telecommunications services.

The federal government will provide the resources to the agency that will be managed by a board of directors, headed by the Minister of Communications and Transport. The country’s telecom regulator, Federal Telecommunications Institute (IFT) will regulate the agency.

In 2014, the Mexican government had undertaken a massive project of shared wireless network to instil competition in the highly monopolistic telecom industry. The idea was to facilitate small-scale telecom operators to use this state-owned network for their wireless coverage instead of installing their own network, which tends to be a highly capital intensive process.

On Jan 29, 2016, Mexico's Secretariat of Communications and Transport (SCT) initiated an auction for the 700 MHz nationwide shared broadband network. These wireless spectrums were freed after all analog TV signals turned digital across the nation by the end of 2015. The SCT plans auction at least 90 MHz of spectrum within the 700 MHz-band to cover nearly 98% of the population by 2018.

Meanwhile, in May 2015, the government of Mexico slashed its planned expenditure from $10 billion to $7 billion for the proposed deployment of nationwide wholesale mobile network over the next 10 years. The primary reason for the cut in planned expenditure is that the government now believes that 12,000 mobile towers will be sufficient for installing this network instead of 20,000 estimated earlier.

In Mar 2015, the SCT had opened tender to take part in this project. Various leading telecom infrastructure equipment developers, with global operational experience had offered bids for the upcoming state-owned mobile network project in Mexico.

Notable among them are Ericsson AB (ERIC - Free Report) , Nokia Corp. (NOK - Free Report) , Cisco Systems Inc. (CSCO - Free Report) , Motorola Solutions Inc. (MSI - Free Report) , China Telecom Corp. Ltd. (CHA - Free Report) , Alestra, and Huawei Technologies Co. Ltd. In Jul 2015, SCT had declared receipt of 37 tenders from interested parties.

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