Mexico Investment In Airwaves

Mexico will start to auction off cellphone airwaves in May, said the Federal Telecommunications Commission, last week. The move is aimed to encourage investment and increase competition among mobile phone networks.

According to a law passed by the Mexican government in 2009, investors will pay annual fees of about $75 million over 20 years for one of the two airwave "blocks" available for new entrants.

The exact amount of time for the auction will depend on how many rounds of bidding there are. The agency will have 30 days to declare a winner after the auction closes.

Regulators say they want to use the airwave sale to encourage investment and competition with dominant operator America Movil, which owns Telcel in Mexico and has over 70% of Mexican cellphone subscribers.

Television company Grupo Televisa and telecom company, Axtel, may also use the opportunity to enter the wireless market.

America Movil could also bid for other airwaves to expand its phone and high-speed internet capacity.

Whatever the outcome of the auctions, the Mexico investment in telecoms will mean massive benefits for the consumer in terms of improved coverage, speed and service.