Best stocks to invest in – Mexico Set to Launch Shared Broadband Network Auction



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Mexico’s Secretariat of Communications and Transport (SCT) is set to initiate an auction for 700 MHz nationwide shared broadband network today. These wireless spectrums were freed after all TV signals were converted from analog to digital across the nation by the end of 2015.

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 is a highly capital intensive process. The SCT will auction at least 90 MHz of spectrum within the 700 MHz-band to cover nearly 98% of the population by 2018.

However, 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 offered bids for the upcoming state-owned mobile network project in Mexico. Notable among them are Ericsson AB ERIC, Nokia Corp. NOK, Cisco Systems Inc. CSCO, Motorola Solutions Inc. MSI, China Telecom Corp. Ltd. CHA, Alestra, and Huawei Technologies Co. Ltd. In Jul 2015, SCT declared that it has received 37 tenders from interested parties.

Mexico is the largest economy in the Latin American region with a growing middle class population eager to spend more on high-speed wireless networks for facilitating the use of smartphones and tablets. Also the wireless penetration rate is relatively lower in the country. Thus, weighing such positives, an investment in the nation may bode well for telecom network equipment manufacturers.


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