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AT&T to Invest $3B on Expanding Iusacell Network in Mexico


AT & T

AT&T is ready to invest $3 billion towards expanding its Iusacell network in Mexico, in hopes of providing the same mobile services they do in the United States.

Their plan is to have the network reach 40 million people by the end of this year, 75 million by 2016, and 100 million by 2018. Mexico’s current population is 122.3 million.

In addition to Grupo Iusacell, AT&T has been buying up other Mexican mobile groups, such as NHI Holdings. Their acquisition of Iusacell gives them all of their wireless properties, network assets, retail stores, and 9.2 million subscribers.

They have spent $4.4 billion building up their presence, and plan to compete with Carlos Slim’s América Móvil and Spain’s Telefonica. The two networks have 72.1 million and 22.5 million wireless subscribers, respectively.

AT&T getting their foot through the door and into Mexico will be mutually beneficial, according to AT&T Chief Executive Randall Stephenson.

“We look forward to bringing more wireless competition to Mexico along with an improved mobile Internet experience for customers. Expanding and enhancing Iusacell’s mobile network to cover millions of additional consumers and businesses is our top priority,” Stephenson said, according to a release.

AT&T felt it was the right time to hop over the border, as they saw a weakness and an opening in the market. A note from J.P. Morgan illustrated that what they did what they felt was best for business. Analysts from J.P. Morgan released a statement to its investors: “AT&T’s interest [in Mexico] was piqued by the Mexican regulator’s declaration of América Móvil as a preponderant [dominant] telecom player and the advantages that have been given to smaller players since, as well as América Móvil’s clear willingness to cede subscribers from here to remove the preponderance label over time.”

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