Mexico cancels 5G spectrum auction, benefiting America Movil's Telcel market position

From Investing.com: 2025-01-20 08:54:22

Mexico’s telecom regulator, the IFT, abruptly cancels the IFT-12 multi-band tender for 5G spectrum before bidding begins. The auction was set to offer around 2,223 blocks of spectrum across different bands, including 600MHz, 800MHz, 2.5GHz, L-band, AWS, and PCS. The decision follows a directive from the Digital Transformation and Telecommunications Agency under the Sheinbaum administration’s reforms.

The telecom industry in Mexico has long pushed for lower frequency usage fees, as they are among the highest in the region, hindering investment in spectrum and network coverage. The last spectrum auction in 2021 saw minimal purchases, with Telefonica returning all spectrum and AT&T reducing holdings. Jefferies analysts suggest the cancellation will impact sector development and investment, potentially benefiting America Movil’s Telcel.

Jefferies predicts that Telcel’s existing 5G network coverage in primary markets reduces the immediate need for additional spectrum. With minimal debt and no imminent mergers or acquisitions, America Movil is expected to increase its share buyback program. The cancellation of the auction is seen as a move that could strengthen Telcel’s market position further.



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