Bloomberg News

Mexico to Push High-Speed Internet With Fiber-Line Auctions

January 31, 2012

(Adds high-speed Internet use in third paragraph.)

Jan. 30 (Bloomberg) -- Mexico will promote high-speed Internet adoption by auctioning licenses to use state-owned fiber-optic lines and to build networks in communities that don’t have the service, President Felipe Calderon said.

The government’s auctions will include contracts to use two fiber-optic lines from state utility Comision Federal de Electricidad, Calderon said today at an event in Guadalajara. The government also will take bids on the use of fiber lines on the federal highway network, he said.

Calderon is pushing to put the technology in the hands of telecommunications providers as Mexico lags in the adoption of high-speed Internet. The nation had 10.5 high-speed broadband subscriptions per 100 residents at the end of 2010, placing it 32nd out of the 34 countries in the Organization for Economic Cooperation and Development, that group said today in a report.

“We’re promoting social connectivity with broadband,” Calderon said. The plan includes contracts to connect schools and public spaces with high-speed Internet, he said.

The government also plans to hire companies to install fiber-optic lines to homes in places where they’re not yet available, Calderon said. Like the highway contracts, the fiber- to-the-home auctions would go to the bidder charging the lowest price to the state, he said.

Companies will be able to use public buildings to place antennas for mobile-phone networks, the president said.

A group including Grupo Televisa SAB, Telefonica SA and Megacable Holdings SAB won a 2010 auction to operate two fiber lines owned by Comision Federal de Electricidad, the state power company. The group bid about $70 million for the contract.

That auction “went very well” and provided Mexico with a national Internet backbone to compete with America Movil SAB’s Telefonos de Mexico unit, Calderon said.

--Editors: Stephen West, John Lear

To contact the reporters on this story: Crayton Harrison in Mexico City at tharrison5@bloomberg.net; Nacha Cattan in Mexico City at ncattan@bloomberg.net

To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net


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