Mexico's MVS Plans Broadband Deal With Clearwire, Intel-Executive
By Ken Parks, Of DOW JONES NEWSWIRES
MEXICO CITY -(Dow Jones)- Mexican communications firm MVS Comunicaciones has
reached a preliminary agreement with Clearwire Corp. (CLWR) and Intel Corp. (
INTC) to invest $700 million in a wireless broadband network covering 23 cities,
a top company official said Friday.
Felipe Chao, MVS vice president of institutional relations, said in a
telephone interview that a formal joint-venture deal hinges on the
Communications and Transportation Ministry renewing the company's spectrum
licenses in the 2.5GHz band in about eight cities, including the key markets of
Monterrey and Guadalajara.
"We also have to go out and find the $700 million. Not everyone has that lying
around in a drawer," said Chao, who declined to go into further detail on how
the partners plan to structure and fund the project.
Clearwire and Intel didn't immediately respond to a phone message and email
seeking comment.
BBVA Bancomer telecom analyst Andres Coello said in a report late Thursday
that he expects the authorities to renew the frequencies given MVS' commitment
to rolling out its network.
"In any case, we should note that this is the No. 1 risk facing the project,
and may potentially delay it," he wrote.
Clearwire--whose strategic investors include Intel, Comcast Corp. (CMCSA,
CMCSK), Sprint Nextel Corp. (S), Google Inc. (GOOG) and Time Warner Cable Inc. (
TWC)--provides high-speed Internet in 24 markets in the U.S.
If the licenses are renewed, MVS and its partners hope to start deploying a
network using WiMax technology during the second half of 2010, with commercial
service starting in several cities during the fourth quarter, Chao said.
MVS currently provides publishing, radio, restricted television and wireless
broadband services. It's also the majority partner in Dish Mexico, a satellite-
TV venture with EchoStar Corp. (SATS).
Should they come to fruition, MVS' broadband ambitions would be a direct
challenge to fixed-line incumbent Telefonos de Mexico SAB (TMX), the country's
biggest Internet service provider with 6.3 million broadband accounts at the end
of September.
Telcel, the country's No. 1 mobile operator and a subsidiary of wireless giant
America Movil (AMX), has also invested heavily to upgrade its network in recent
years to offer high-speed data services.
A new wireless broadband competitor would also put greater pressure on small
phone companies such as Axtel SAB (AXTEL.MX), which is rolling out its own WiMax
network, and cable TV companies that are slugging it out with Telmex in the
phone and Internet markets.
-By Ken Parks, Dow Jones Newswires; 52-55-5980-5177; ken.parks@dowjones.com
(END) Dow Jones Newswires
11-27-091535ET
Copyright (c) 2009 Dow Jones & Company, Inc.
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