Mexico has the second lowest broadband penetration among OECD countries, higher only than that of Turkey. Several lapses from the government and regulator have led to this state of play.
Among the chief of them is the lack of an effective infrastructure access regime. In this, Mexico lags behind most developed broadband economies. Although public network infrastructure (poles and ducts, etc) must theoretically be accessible to third parties, the facility is cumbersome in practice, resulting in delays to projects and the paucity of effective competition. The provision does not yet extend to private networks.
Nor is there provision for infrastructure sharing, which can dramatically reduce capital expenditure. The facility is common in Europe: effective regulatory measures in France and Switzerland have led to the rapid rollout of fibre networks in these markets during the last two years. The Mexican government’s own scheme to promote facility-sharing came to grief in 2009 under the weight of legal wrangling from three of the main telcos.
Nevertheless, the government is aiming to address the country’s broadband shortcomings. Its ambition to boost broadband penetration to 22% by the end of 2012 may be an unfeasible objective, but some measures being adopted are at least steps in the right direction.
Among them is a program to fund computers and broadband services to some 1.7 million premises, as well as subsidising the cost of broadband access from ISPs for the first year.
The government is also planning to auction to ISPs leases on state-owned fibre lines operated by the state-owned Comision Federal de Electricidad (CFE). This is aimed at pushing broadband services deeper into unserved or underserved rural areas. The move follows a similar, earlier, scheme which saw a consortium comprising Televisa, Telefónica and Megacable pay MXN884 million for 20-year access to unused portions of CFE’s fibre network reaching 19,500km and covering about half the population. Although only two fibres were then offered, CFE has a further 34 available across the country.
Henry Lancaster,
Senior Analyst, Central America
For further analysis on developments in Mexico’s broadband market, see the updated report Mexico – Broadband Market Insights, Statistics and Forecasts.
