Disagreements continue over Mexico’s spectrum prices

Disagreements continue over Mexico’s spectrum prices

What appears to be a stand-off involving operators, the regulator and the country’s finance ministry over spectrum prices looks set to continue in Mexico.

The finance ministry has rejected, apparently for the sixth time, a proposal to reduce the costs of the radio spectrum by regulator the Instituto Federal de Telecomunicaciones (IFT).

In its plans for the for fiscal year 2024, the ministry, Secretaría de Hacienda y Crédito Público (SHCP), has rejected two proposals from the regulator: firstly that operators pay only 1% of their income for the rights to use frequency bands; and secondly that the prices of the bands be adjusted in accordance with international standards for those companies with a stake of less than 25% in the mobile market.

Instead the price of spectrum in Mexico – said to be up to 89% higher than countries like Germany, Italy, Greece and the Netherlands – is to be frozen.

According to local news resource Expansion, operator AT&T has this year returned part of its AWS and 850MHz spectrum and may yet return more. In addition 5G network rollout could be hit.

Such eventualities would be an issue for end users, of course, but would also hit government finances if, as expected, the public deficit grows by 2024.

The IFT had planned what is known as the IFT-12 tender for this year, focusing on 5G-ready spectrum. However, the finance ministry’s decision might force it to rethink its plans.

However, the IFT is not giving up just yet. According to Expansion it will appeal to the country’s legislative branch, which could still modify the final version of the spectrum rights law.

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