Mexico’s second largest cellular operator Telefónica Móviles Mexico has selected Ericsson as the main equipment supplier for the rollout of its GSM-1900 network. Ericsson will supply the entire core network and around 50% of the radio access network, with the contract also including delivery, installation, systems integration and adaption of existing sites, as well as the technical launch of the network. While Ericsson is the sole supplier of network equipment, Telefónica Móviles plans to roll out services on a nationwide basis using a variety of other unnamed vendors. The cellco is hoping that the build out of the network will help strengthen its presence in the country, at a time when its Brazilian operations are facing increasing competition from the likes of dominant América Móvil and Telecom Italia Mobile.
Telefónica Móviles began broadening its presence in the Mexican mobile market in September 2002 with the acquisition of Pegaso PCS. Pegaso was awarded PCS licences in nine of Mexico’s cellular regions, launching services over a digital CDMA network in 1999. At the end of March 2003 Telefónica Móviles had 2.43 million subscribers in Mexico, a market share of just over 9%. Despite being the country’s second largest cellco, it has a lot of ground to gain if it is to become a serious competitor to the number one operator Telcel which had 20.7 million customers at the same date.