What opportunities will LTE hold for Mexico?

LTE networks will create new business opportunities in Mexico, where the technology is expected to account for 42% of the country's mobile lines next year.

This is according to Jesús Romo, consultant at Telconomia, who said in a 5G Americas webinar that LTE mobile connections are expected to reach 70% of Mexico's mobile lines by 2020. This figure excludes machine-to-machine connections.

According to Romo, 3G lines will peak next year and will begin to decline in 2019.

The consultant said voice over LTE (VoLTE) will make voice services attractive once again. As a direct consequence, operators will begin moving away from 2G and 3G networks, which prioritize traditional voice over data, in order to cut costs.

A more important application consists of using LTE networks to provide internet of things connections. Traditional carriers can provide security, coverage, dedicated spectrum, and interoperability when using their LTE networks for IoT applications, said Romo.

IoT applications over LTE networks will create new business opportunities for traditional operators and startups alike. Some of the areas of opportunity are smart city initiatives, fleet management, smart agriculture, and industry 4.0 applications, he added.

Operators must complement their infrastructure with information technologies to develop and launch new digital services. Romo predicted that there will be at least five LTE operators in Mexico next year. In addition to traditional carriers Telcel, AT&T, and Telefónica, Mexico will see wholesale network operator Altán Redes provide LTE services as part of the Red Compartida wholesale network. For its part, lcoal cable operator Ultravisión has said it will use its concession in the 2.5GHz band to provide LTE services.

SPECTRUM ALLOCATION

According to Romo, Mexico currently holds the fifth place in terms of awarded spectrum in Latin America. The country has awarded 464MHz while the regional average stands at 361MHz.

Romo attributed Mexico's 48% growth in awarded spectrum to Altán's concession in the 700MHz band and Telcel's indirect acquisition of spectrum in the 2.5GHz band.

In addition to spectrum in the 2.5GHz band that could be awarded next year, Romo said the country has the potential to award 100MHz in the 2.3GHz band and 91MHz in the 1427-1518 band after 2020. Similarly, 20MHz in the 1.9GHz band could be eventually re-farmed and a second digital dividend in the 600MHz band could yield 70MHz in 2020.

Romo underscored that state royalties can make up to 80% of a spectrum license. In his view, inflexible duties imposed by congress must be reviewed in order to make spectrum concessions more competitive.