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'Stand aside': Mexico to create public internet company

Bnamericas Published: Tuesday, May 14, 2019

Internet and telecommunications companies that have failed to expand connectivity across Mexico can "stand aside" while the government launches its own internet company, President Andrés Manuel López Obrador said over the weekend.

The remarks reinforce comments made earlier this year about the willingness of his administration to build a public connectivity network if the private sector fails to bid for the ambitious "Internet para Todos" program, led by state-owned electricity company CFE.

López Obrador has frequently complained that the country is ill-covered by telecommunications companies that focus on profits more than on  connecting thousands of smaller, remote or poor townships.

International connectivity indexes such as the International Telecommunication Union's 2017 IDI index put the country in 17th place, out of 35 American countries in terms of telecommunications development, with around 83% mobile penetration and less than 60% of inhabitants using internet, just below Venezuela.

López Obrador's government launched this year a project to reach those locations via a public-private partnership using two high-capacity fiber optics strands belonging to the CFE, which operates an electricity transport and distribution network that covers over 90% of Mexico's population centers.

"As companies find it is not profitable, they don't offer services in remote towns," López Obrador said. He insisted that his government has an open invitation to all companies interested in the project, which will allow operators to offer commercial services using the network's excess capacity after fulfilling a quota of thousands of free internet connectivity sites.

"We are going to respectfully ask the companies that have had the concessions and have not connected the country: stand aside because now the government will have its own company so all Mexicans communicate via internet," he added.

Both that project and the parallel Red Troncal high capacity wholesale network, which is also expected to use the CFE's fiber optics network, have caused doubts among investors who have questioned the compatibility with operators' technology and business case.

The Red Troncal bidding process has been postponed several times since its original launch in 2018.

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