Telefonica and Iusacell confirmed their anticipated partnership for the Mexican market, with the companies establishing a network infrastructure joint venture intended to “generate a better alternative for all Mexicans.”
According to a statement, the pair will work to bridge the digital divide between rural and urban areas, as well as positioning them to deploy new technologies such as LTE. The companies will compete at the service level, as well as managing their spectrum independently.
Adrian Steckel, director general of Iusacell, described the partnership as being “in favour of competition and against the existing monopoly” in the country.
Wireless Intelligence figures show that the Mexican mobile market is dominated by Telcel, the local arm of America Movil, which has a 70 percent market share. Telefonica’s Movistar arm is placed second with a 20 percent share, and Iusacell third with 5.5 percent.
The deal will also see Telefonica able to share some of its build costs with its peer. The company is in the process of improving its financial position in order to guard against weakness in its core Eurozone markets. It has already embarked on a network sharing deal with Vodafone in the UK.
It has also been reported that Telefonica may hold an IPO for some of its Latin American assets, although this has not been detailed.