Virus impact over each market - telecom operators, government agencies and regulators' responses - revised forecasts for the next 5 years.
With a population approaching 125 million and with relatively low broadband and mobile penetration, Mexico’s telecom sector retains significant potential for growth. The market is still dominated by the incumbent Telmex and by Grupo Televisa, which together retain about two thirds of subscribers overall. A sector regulator set up in 2013 has enforced measures aimed at removing barriers to foreign investment and at reducing the market share of these dominant operators. The reforms are helping to make Mexico’s telecom market more competitive.
The Senate’s multi-party coordination body in June 2020 proposed a merger between three agencies – COFECE, the IFT and the CRE – into a single agency, which would require an amendment to articles 27 and 28 of the Constitution. Such a merger could make the market less competitive, and discourage foreign investment.
In the fixed broadband sector significant changes are underway, with the main cable TV providers Megacable and Grupo Televisa widening their bundled services offerings, and with some important market consolidation. The fibre sector has shown particularly strong growth during the last two years as the key operators expand their network reach beyond the core densely urban areas.
The mobile market also continues to undergo considerable changes in the wake of regulatory efforts to curb the market dominance of Telcel. Although the MVNO segment has only a very small market share, it continues to attract investment, and new players enter the market each year. A wholesale mobile network operating in the 700MHz band was set up in 2018 and will reach the vast majority of the population by 2025. Developments in 5G have been slow given the existing capacity of LTE, though the auction of spectrum in the 600MHz band (among the first globally) later in 2021 will stimulate the sector as operators launch services.
The coronavirus lockdowns resulted in a decline in revenue for all operators during 2020, though there was a rebound for some of them in the third quarter. The sector will remain under some fiscal strain for the remainder of 2021. Companies with e-commerce offerings, too, have reported a significant growth in sales due to social distancing measures.
This report provides statistics and analyses on Mexico’s fixed-line market, as well as an overview of regulatory developments. The report also reviews the mobile market, including a range of statistical data as well as subscriber forecasts. In addition, the report covers the fixed and mobile broadband sectors, including an assessment of technological and regulatory developments.
BuddeComm notes that the outbreak of the Coronavirus is continuing to have a significant impact on production and supply chains globally. During the coming year the telecoms sector to various degrees is likely to experience a downturn in mobile device production, while it may also be difficult for network operators to manage workflows when maintaining and upgrading existing infrastructure. Overall progress towards 5G may be postponed or slowed down in some countries.
On the consumer side, spending on telecoms services and devices is under pressure from the financial effect of large-scale job losses and the consequent restriction on disposable incomes. However, the crucial nature of telecom services, both for general communication as well as a tool for home-working, will offset such pressures. In many markets the net effect should be a steady though reduced increased in subscriber growth.
Although it is challenging to predict and interpret the long-term impacts of the crisis as it develops, these have been acknowledged in the industry forecasts contained in this report.
The report also covers the responses of the telecom operators as well as government agencies and regulators as they react to the crisis to ensure that citizens can continue to make optimum use of telecom services. This can be reflected in subsidy schemes and the promotion of tele-health and tele-education, among other solutions.
América Móvil (Telcel, Telmex), Megacable, Cablemás, Cablevisión, Grupo Televisa, Maxcom, Sistemas Interactivos de Telecomunicaciones (SIT), Axtel, Megafón, InterCable, CFE, , AT&T Mexico (Iusacell, Nextel Mexico), Movistar (Telefónica Mexico), Globalstar, Unefón, Virgin Mobile, Weex, Alestra, Maxcom, Marcatel.
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BuddeComm's strategic business reports contain a combination of both primary and secondary research statistics, analyses written by our senior analysts supported by a network of experts, industry contacts and researchers from around the world as well as our own scenario forecasts.
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