The president of Mexico’s Communications and Transportation Commission of the Chamber of Deputies, Víctor Manuel Perez Diaz, has called for spectrum prices to be lowered to facilitate the country’s deployment of 5G.
Speaking to local news outlet Milenio, Diaz said: “In terms of competition, we are far behind, and this situation cannot continue, especially when the 3.5GHz band is about to be tendered … it should not be considered a privilege, but a tool for knowledge, business and all kinds of transactions.”
The opinion is shared by Alejandro Navarrete Torres, the Head of the Radio Spectrum Unit at regulator IFT (Instituto Federal de Telecomunicaciones), who said to the same outlet: “We have submitted proposals to the Ministry of Finance and the legislature to analyse the situation of the high cost of spectrum use in Mexico, which is up to 186% higher than the international average.” Torres indicated that in 2022 alone, overpriced spectrum and delayed auctions have drained MXN4.5 billion (US$224.9 million) of government finances.
The IFT’s Annual Work Programme, approved in February this year, confirmed that spectrum in the 600MHz, 1500MHz (L-band), 3.3GHz and 3.5GHz bands would be made available for bidding in its next round of auctions. No date was specified, and while the auctions could still take place this year, enthusiasm appears to be low due to the high costs associated with the licences.
Spectrum buyers in Mexico must pay an initial fee upon acquiring a holding, as well as an annual licence fee for the entire 20-year validity period, meaning that the total cumulative cost of a concession in Mexico is substantially higher than the equivalent in other markets.