Movistar Mexico and Iusacell to share network infrastructure

14 Jun 2012

Spanish telecoms giant Telefonica has inked a deal which will see its Mexican subsidiary, and the country’s second largest cellco by subscribers, Movistar Mexico, share infrastructure with rival Iusacell, which currently holds third place in the wireless sector. According to Reuters, the agreement between the two operators is similar to one announced by Telefonica for its UK operations earlier this month, with the five-year deal between Movistar Mexico and Iusacell expected to cover the sharing of cell sites as well as fibre-optics. Further, it is understood that the two companies will jointly start testing Long Term Evolution (LTE) services in a number of unnamed Mexican cities later this year, although a commercial launch of the technology is not expected until 2013. The agreement between the pair is expected to see Telefonica benefit from an improved level of coverage in larger cities, where Iusacell has a more developed network, while for its part Iusacell will be able to tap Movistar’s rural network, enhancing its presence in such areas. Details of roaming costs across the two networks have, however, yet to be revealed, but are expected to be released once the network sharing agreement is fully up and running. Looking ahead, meanwhile, the report also claims that Telefonica is to invest around USD500 million in Mexico this year, while Iusacell’s capital expenditures are likely to be between USD500 million and USD600 million in the period from now until end-2013.