The wireless communications market in Mexico suddenly becomes highly competitive. Recent move by the Mexican Government to conduct auctions for both fiber optic strands and wireless spectrums are aimed to boost competition in the country’s telecom market, which was highly monopolized by the two companies controlled by billionaire Carlos Slim. This airwave and fiber-optic bandwidth auction resulted in increased competition in the Mexican wireless segment.
 
Grupo Televisa S.A. (TV), the undisputed leader of the Mexican cable TV market, has decided to acquire 30% stake of Nextel Mexico, the Mexican subsidiary of NII Holdings Inc. (NIHD). Recently, Televisa-Nextel venture won 30 MHz nationwide block in the 1.7 GHz band of wireless frequency. In last July, Televisa and Nextel together also won one block of frequency ranging from 1850 MHz – 1990 MHz. Nextel is currently working on building its nationwide 3G wireless networks.
 
Most recently, the second largest cable operator Megacable Holdings SAB and second largest telecom carrier Telefonica S.A. (TEF) together formed a joint venture through which Megacable will sell the wireless services of Telefonica to its subscribers.
 
In June 2010, the Communications and Transportation Ministry of Mexico awarded a 20-year lease for two strands of 19,457 Kilometers optical fiber lines to a consortium led by Televisa. The consortium was formed by Televisa, Telefonica and Megacable Holdings.
 
The incumbent wireless giant America Movil S.A.B. de C.V. (AMX) currently controls around 70% market share and incumbent fixed-line giant Telefonos de Mexico S.A.B. (TMX) controls around 80% market share. Both of these companies are controlled by Carlos Slim. In a significant move, Telefonos de Mexico is trying hard to get government approval to enter into cable TV market. This is a counter move by Carlos Slim to enter into its rival’s market. 

 
AMER MOVIL-ADR (AMX): Free Stock Analysis Report
 
NII HLDGS-CL B (NIHD): Free Stock Analysis Report
 
TELEFONICA S.A. (TEF): Free Stock Analysis Report
 
TELMEX ADR-CL L (TMX): Free Stock Analysis Report
 
GRUPO TELEVISA (TV): Free Stock Analysis Report
 
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