Megacable not looking to fight government plan to remove 2.5GHz spectrum

19 Sep 2012

Mexican cable operator Megacable says it has no plans to launch a legal challenge to protect 2.5GHz spectrum licences that are due to be refarmed for the deployment of 4G technology in the country. The cableco has opted against fighting the Secretario de Comunicaciones y Transportes (SCT’s) decision not to renew expiring licences in the 2.5GHz band, but instead says it ‘expects to be compensated for amounts it has already invested’ in this area. Megacable believes that it is unlikely to win a legal challenge but wants compensation given that it is reliant on the aforementioned frequency band to deliver wireless broadband services to some 17,000 subscribers in the city of Juarez, Chuhuahua.

As reported by TeleGeography’s CommsUpdate, last month the Mexican government announced that operating concessions in the 2.5GHz band will be reclaimed and the recovered spectrum auctioned off to all comers – including to those companies already operating in the local telecoms market. The process is expected to take some time though, as some of the companies currently holding concessions are looking to fight to retain their spectrum holdings, raising the possibility of legal challenges.

There are currently eleven operators with a total of 68 concessions in the 2.5GHz band, the largest loser from this decision is likely to be MVS Comunicaciones, which has been embroiled in a long-running dispute with the state over its licences. One week after the SCT’s announcement, MVS confirmed plans to mount a challenge to stop the plan. MVS chief executive officer Joaquin Vargas was quoted at the time as saying that the state’s decision to recover the spectrum was made while his company was still in negotiations over the fate of its licences. Mr Vargas was also reported to have claimed that government officials had pressured his company on unrelated issues, with the renewal of its concessions used as a bargaining tool, while he alleged that the government was looking to overcharge MVS for the frequencies. Communications and Transport Minister Dionisio Perez-Jacome however denied such claims, reiterating the government’s previous stance that the spectrum was being underutilised