AT&T to Expand 4G LTE Mobile Internet Network in Mexico

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U.S. telecom behemoth AT&T Inc. T has decided to invest $3 billion to expand high-speed mobile Internet network in Mexico. The service is likely to cover 40 million people within the next six months and will be available to 75 million people by the end of 2016. The company aims to provide 4G LTE mobile Internet service to 100 million Mexican customers by the end of 2018.

Earlier this year, AT&T had entered into the Mexican telecom industry with the acquisition of Gurpo Iusacell and Nextel de Mexico for a total consideration of approximately $4.4 billion. Last year, the government of Mexico had reformed its telecommunications sector, which was highly monopolistic with one or two companies dominating the market. As the new reforms open up considerable scope for investment in Mexico, AT&T is striving to capitalize on the opportunity.

Acquisitions of Grupo Iusacell and Nextel de Mexico have added around 12.2 million subscribers to AT&T’s kitty. The combined synergies from the Iusacell and Nextel buyouts have positioned AT&T as a formidable player in the lucrative wireless market of Mexico. At present, America Movil SAB AMX controls nearly 70% while Telefonica SA TEF commands around 20% of the Mexican wireless market.

In Feb 2015, AT&T launched a service which allow its prepaid GoPhone customers, on $60 data plans, unlimited calling from the U.S. to any number in Mexico without imposing any additional charge. The company’s postpaid customers on World Connect Value plans can also get unlimited calls to Mexico as a $5 add-on. The new product is a part of AT&T’s larger strategy to develop a pan-North American mobile service zone to serve individual consumers and business enterprises in the U.S. and Mexico.

Meanwhile, AT&T has decided to acquire DIRECTV DTV, the largest satellite TV operators in the U.S. DIRECTV boasts a strong presence in several Latin American countries including Mexico. The deal, which is valued at $48.5 billion, is currently awaiting regulatory decision.

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