America Movil was given thirty days to modify a proposal to spin-off part of its fixed business by the Mexican communications regulator, after its original plan was deemed unsatisfactory.
The Mexican market leader was ordered to create a wholesale business entirely separate from fixed unit Telmex by the Instituto Federal de Telecomunicaciones (IFT), which is looking to boost competition in the sector by improving terms for rival operators.
In a statement, the regulator said America Movil’s proposal needed to be altered to “ensure the effectiveness of the functional separation and the fulfillment of the objectives foreseen in the constitutional reform in telecommunications.”
Its order is an attempt to curb the dominance of the company, which is both the largest fixed and mobile provider in the Mexico with an estimated market share in both sectors exceeding 60 per cent.
The IFT said its measures would “eliminate barriers identified in the telecommunications sector through the effective provision of wholesale services, in order to guarantee the access of all operators, under non-discriminatory conditions, to the necessary inputs for the development of the healthy competition and free competition.”
Telecom sector reforms have been mooted since 2014 by the IFT, which applied increased pressure on America Movil to make changes to its business. Earlier this year, the regulator re-emphasised requirements to create a new fixed business in addition to easing the path for MVNOs in the country by reviewing its wireless wholesale policies.
In March 2017 the operator said it would fight the IFT’s decision, but since submitted a proposal in an apparent bid to comply to its fixed demands.