Mexico: Movistar and AT&T prepare for 2.5GHz band bidding

The semiannual operation of Spanish telecommunications group Telefónica’s Mexican subsidiary recorded a fall of 14.3% in total revenues, and 19.9% ​​in revenues from services, equalling 574 million euros (US$668.93 million) for the first and 449 million euros (US$523.26 million) for the second.

The figures were released one week before the launch of the bidding process for six 20 MHz broadcast spectrum blocks with national coverage from the 2.5 Gigahertz band. The confirmed bidders are AT&T and Grupo Telefónica, although the former may only compete for up to four blocks due to restrictions set by the Mexican regulator, the Federal Telecommunications Institute.

Despite having registered an operating loss of US$217 million for the second quarter of the year, experts have said that AT&T will be in a better position than Movistar to buy more than one 2.5 GHz block in the IFT-7 auction, since the increase of its general revenues by 8.1%, up to US $697 million for the April-June period, plus the 753,000 new net users in the quarter, and the fact that the operator has given a final push to its scheduled investment of US$3 billion since it arrived in the country in 2014, makes some believe that AT&T would be better placed to cover the 350 million pesos (US$18.7 million) guarantee required for each block.

“The bid for the 2.5 band offers a new opportunity to understan know the intentions of Telefónica in Mexico,” added Juan Gnius, Telracom. “This spectrum will enable it to offer higher bandwidth services with carrier aggregation, that is, to combine the spectrum it already has with the 2.5 GHz spectrum. That open up the possibility of offering new services or providing greater strength to those released to the market. “Full Content: America Economia

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