Instituto Federal de Telecomunicaciones

More benefits for the users of telecommunications services

• The new measures were imposed on Telmex and Telcel as they are determined to be preponderant economic agents
• Users will not pay for visiting user or roaming services when they are outside the local service or region in which they hired the service
• Telcel must deliver unlocked cell phones to subscribers under the prepaid scheme and postpaid scheme when equipment has been paid in full at the time of hiring the service

As a result of the various measures imposed by the Federal Telecommunications Institute to Telmex and Telcel, as they are determined to be preponderant economic agents in the telecommunications sector, both companies have the obligation to offer better conditions to their users when providing services.

These measures are intended to avoid that the competition in this sector is affected and that users benefit from a better service, such as:

• ROAMING. Telcel will cease charging for visiting user or roaming when its users use their own network, irrespective if they are located outside the local service or region in which they hire the service. For example, if a user who hired the service in Mexico City travels to Monterrey and makes a call to another user who is located in any other city in the country, the user will only pay the long distance rate, and no longer the roaming service. In that light, if this user calls a user who is located in Monterrey, the user will only pay local service rate. In the same case, if that user receives calls while in another city, service charges for the roaming service will not apply.

• UNLOCKING. All phones contracted under the prepaid scheme at Telcel must be delivered unlocked. If the contract is by lease (postpaid), unlocking will apply when the user covers the total cost of the equipment.

If the services were contracted before this April 6th, Telcel has 90 days thereafter to release the equipment, provided the owner has covered the full cost of the phone requested to be unlocked.

Unlocking is free in all cases, as long as the user requests it, and the user is not required to provide any documents. This process can be carried out at the service centers with the equipment only, and if technically feasible, unlocking can also be carried out remotely. Equipment which is reported as stolen cannot be unlocked.

• BILLING. Telcel must deliver invoices to its customers which detail the charge for telecommunications services received, and details of other goods or services other than telecommunications services. By doing so, the user can pay both charges independently, and if the user has fully paid the telecommunications service, the operator will not be able to interrupt the service, regardless of debts for goods or services that are not those of telecommunications.

Bills for postpaid service will include the information of the amount that the user will have to pay in the event that the user decides to cancel the contracted line early.

• TIE-IN SALES. The provision of a service cannot be conditioned to hiring another. For example, a user can hire broadband Internet service without having to purchase or have a local fixed telephone line.

• CANCELLATION. The terms that the user had at the time of contracting will be granted when cancelling the service, i.e., this process can be carried out at the contractor's express request by a telephone call. From the time of the end of the contract, no further charges can be made to the user.

The comprehensive document that contains all the measures imposed on Telmex and Telcel is available on the Institute website: www.ift.org.mx

The IFT will remain attentive of the preponderant economic agents' fulfillment of their obligations regarding telecommunications.

Mexico will occupy the committee vice-presidency for information, computer and communications policy Bureau of the OECD

• The IFT Commissioner, Mario Fromow Rangel was elected to carry out the position in representation of the country
• This appointment strengthens the leadership of the country and will contribute to position IFT internationally

Mexico, through Commissioner Mario Germán Fromow Rangel, was elected today by Organization for the Economic Cooperation and Development (OECD) member countries to occupy one of the Vice-presidencies of the Committee for Information, Computer and Communications Policy (ICCP) of this international body for 2014.

The Bureau will be integrated by nine officials: a president, who in this case will be from Danish government and eight vice-presidents of Norway, United Kingdom, Korea, the United States of America, Japan, Switzerland, Italy and Mexico governments.

The ICCP is responsible to promote public policy and regulation required for the expansion of Internet and Information and Communication Technologies (ICT) such as innovation force, productivity, growth, sustainable development and social welfare, as well as to fortify the cooperation between the member countries in this field and, in their case, between the member and nonmember countries.

This Committee develops principles and guidelines for the definition of public policy and regulation regarding:

• To support innovation, investment and competition in ICT and areas in all fields of economy and society, as well as to encourage the creativity in the development and use of Internet and ICT.

• To facilitate digital networks, devices, applications and services convergence, as well as to promote the universal access to networks and ICT.

• Contribute to the sturdiness and security of networks and information systems fortification, as well as the protection of privacy to improve the confidence in the use of Internet and ICT.

• Promote the interchange of experiences between member countries in areas of information, computers and communications policy, including the development of indicators to measure the advances in the information society.

The ICCP is made up of four working groups: infrastructure policy and communications services, information economy, information security and privacy and indicators for the Information Society.

This Committee is in charge, among other aspects, to carry out works for the biennial publication

“OECD Communications Outlook”, which provides an ample range of various telecommunications networks development indicators and compares performance indicators such as incomes, investments, uses and prices of the services in the OECD member countries.

With this appointment to Commissioner Fromow Rangel, the presence and leadership of the country is strengthened, as well as it will contribute to position IFT onto the international scope.

The Federal Telecommunications Institute decided to impose sanctions and declare the loss, in the nation benefit, of 9 broadcast stations operating without permission or concession

• The regulatory body will maintain verification and monitoring in order to ensure that broadcasting services be provided in strict adherence to the legal framework

In the 8th extraordinary session today, the Plenary of the Federal Telecommunications Institute (Instituto Federal de Telecomunicaciones, IFT) ruled sanctions and declared the loss in benefit of the Nation of goods intended for the operation of 9 broadcasting stations transmitting in the FM band in the Federal District and in the state of Puebla, without concession or permission.

As part of the verification performed by the Institute to monitor the proper use of the radio spectrum, the regulatory body carried out the corresponding preventative assurance visits at the addresses where these stations operated in order to avoid that they continue transmitting.

As a result of these proceedings and the due administrative procedure followed, the Institute confirmed irrefutably the lack of concession titles or permits that credited the legal operation of the stations.

As a result, the IFT Plenary determined, in terms of articles 101, fraction XXIII, 103, 104 bis and 106 of the Federal Radio and Television Law, to impose sanctions and declare the loss in benefit the nation of the goods intended for the operation of the respective stations at the following frequencies and locations:

The Federal Telecommunications Institute confirms its commitment to continue with surveillance actions so broadcasting in Mexico is provided in due conditions and under the terms of the Law.

The Federal Telecommunications Institute Plenary determines asymmetrical rates for interconnection services that the Preponderant Economic Agent will charge

• IFT draws on the Guideline final methodology to elaborate cost models published on April 12th, 2011
• These measures apply to Telmex, Telnor and Telcel, following the Institute Plenary determination on March 6th of this year that this group of companies is a preponderant economic agent

On March 6th, the Plenary of the Federal Telecommunications Institute (Instituto Federal de Telecomunicaciones, IFT) adopted the resolution by means of which it determined the preponderant economic agent in the telecommunications sector (Telmex, Telnor and Telcel) and imposed specific measures, in accordance with the provisions of the Eighth Transitory article of the decree of Constitutional Reform in Telecommunications matters.

Among these measures it is established that IFT is responsible for setting the rates for interconnection services for fixed services that the preponderant economic agent will charge, which shall be determined based on a cost model drawn up in accordance with the Guidelines published on April 12th, 2011 for this purpose, but considering their involvement measured in terms of end users. The spectrum availability for mobile services of the preponderant economic agent must be taken into account.

Thus, at the ordinary session held on March 26th this year, the Federal Telecommunications Institute Plenary, determined the asymmetrical rates that the preponderant economic agent will charge in the telecommunications sector for interconnection services to their networks.

The interconnection fees approved by the Plenary will take effect from the onset of the Measures imposed on the preponderant economic agent in the telecommunications sector up to December 31st, 2014.

The Fixed Cost Model that applies to Telmex and Telnor considers the concept of network hierarchy and the costs for each are calculated for the interconnection scenarios in which traffic is originated or ends, as well as for transit service. Rates for interconnection services that must apply for both companies during the period are:

With respect to the rates for interconnection services related to the termination service that Telcel will charge, the IFT resolved under the following terms:

The resolution of the Plenary establishes that the traffic measurement will be done by adding the real time of all completed calls during the billing period, measured in seconds, without the possibility of rounding off the next minute. Similarly, a surcharge for non-completed calls must not be added in the origin and termination of traffic in telecommunications public networks of Telmex and Telnor. The Fixed and Mobile Cost Models that were used to calculate the interconnection rates of the preponderant economic agent can be accessed at the following IFT website page: https://www.ift.org.mx/iftweb/sector-‐de-‐telecomunicaciones/

The IFT Plenary approves the program on geostationary orbital positions to be tendered in 2014

• Regarding the 113° West and 116° West positions and their C and Ku-bands extended for the provision of satellite communications services
• Greater competition is promoted in the market and thereby better conditions arise in quality and prices for the benefit of users

At ordinary session of today, the Plenary of the Federal Telecommunications Institute (Instituto Federal de Telecomunicaciones, IFT) approved by unanimity the Tender program for two geostationary orbital positions for commercial use, for the provision of communication services via satellite such as dedicated data, direct home television and corporate links.

The geostationary orbital positions concessions, which will be granted by IFT through a public bidding process to be held during 2014, are: 113° West and 116.8 ° West and their associated C and Ku range bands, with coverage in the national territory.

The concession of orbital resources, - which rights of occupation were accomplished by Mexico in accordance with the procedures laid down in the Radio-communications Regulation of the International Telecommunication Union, is of great import due to it promotes greater competition in the satellite industry, providing wider service offerings in the market, which will generate that these provide better quality and price conditions.

It is important to mention that the last allocation of geostationary orbital positions in the country was conducted in 2005.

In the coming days, this Program will be published in the Federal Official Gazette (Diario Oficial de la Federación, DOF).

Furthermore, the IFT Plenary issued unfavorable resolutions to 14 requests for extension of validity of frequency assignments of official use. In 11 cases, the refusal was due to non-compliance of obligations arising out of the respective assignments; and in the remaining three cases, the reason was, that from the regulatory point of view, the bands originally assigned are referred for purposes other than the ones requested.

With these resolutions, the State recovers those frequencies of the spectrum and advances toward their rearrangement, in order to achieve a more efficient use of this resource.

In addition, the Plenary approved the quarterly report activities of the Federal Telecommunications Institute, which, in compliance with the provisions of the political Constitution of the United Mexican States, will be presented to the Executive and Legislative Powers of the Union, as well as posted on the Institute website.

The Federal Telecommunications Institute plenary approves for the first time in the country the call to tender for broadcast television frequencies to form at least two new networks with national coverage

• IFT fulfils in a timely manner the mandates set out in the Constitutional Reform Decree in the telecommunications field
• The Call to Tender will be published tomorrow in the Official Gazette of the Federation and the bidding requirements will be available for electronic download by March the 9th
• This resolves the proceedings initiated for the determination of preponderant economic agents in the telecommunications and broadcasting sectors and safeguarding measures to avoid affecting the competition and the free competition in these markets, as well as measures for the effective unbundling of the preponderant economic agent in telecommunications local network

Pursuant to the mandate established in section II of Transitory Article Eight of the Decree of Constitutional Reform in the telecommunications matters, published in the Federal Official Gazette on June 11th, 2013, in an extraordinary meeting held today, the Federal Telecommunications Institute (Instituto Federal de Telecomunicaciones, IFT) Plenary approved the Call to Public Tender for the concession of the use, leveraging and commercial exploitation of transmission channels for the provision of the digital broadcast television public service, for purpose of forming two networks with national coverage.

According to the transitional article, IFT had a period of 180 calendar days from its formation to comply with issuance of a Call and bidding rules concerned, for which the Call will be published tomorrow in the Federal Official Gazette (Diario Oficial de la Federación, DOF).

It is important to point out that in accordance with the administrative procedure, the Call must be published first in the DOF in order for the bidding rules to be made public, for which they will be available by March 9th on the IFT website with a free download.

In this way, for the first time in the history of the country, a bidding process will be achieved to assign new broadcast frequency concessions, which intends to achieve greater competition in this market, for the benefit of the users of this service.

Furthermore, at the same Plenary session were approved resolutions to the proceedings initiated for the determination of preponderant economic agents in the telecommunications and broadcasting sectors and safeguarding measures to avoid affecting the competition and the free competition in these markets, as well as measures for the effective unbundling of the preponderant economic agent's local network in telecommunications, in fulfillment of what is required in the fractions III and IV of the Eighth Transitory article of the Decree of constitutional reform in telecommunications matters.

The Institute will not provide further information on these resolutions until they are duly notified to the economic agents involved in referral procedures.

Once concessionaires are duly notified, the IFT Plenary will hold a press conference to publicize its details and all resolutions issued pursuant to the constitutional mandates.

IFE and IFT hold their first working meeting

The Federal Electoral Institute (Instituto Federal Electoral, IFE) and the Federal Telecommunications Institute (Instituto Federal de Telecomunicaciones, IFT) carried out a visit to the National Center for Monitoring of the Integrated System for the Administration of State (Centro Nacional de Monitoreo del Sistema Integral para la Administración de los Tiempos del Estado, SIATE) where the operation and procedure that the electoral body follows to perform the schedules the promotional parties, compliance and verification of their transmission by radio and television industry was demonstrated.

 This meeting, which is part of the Framework Agreement for Collaboration for Technical Support in the Field of Monitoring of Media, signed by both institutions on November 14th of 2013, the IFT was attended by the Commissioner President, Gabriel Contreras Saldivar, Commissioners María Elena Estavillo and Sofía Labardini, Fernando Borjón, Mario Fromow, Ernesto Estrada and Adolfo Cuevas. IFE attendees were the Acting President Adviser Benito Nacif, Electoral Adviser María Marvan, Marco Antonio Baños and Lorenzo Córdova, as well as Executive Secretary Edmundo Jacobo.

 This visit is part of the collaboration that IFE committed with IFT, working together to strengthen their constitutional duties in telecommunications, as well as the use of the resources of the Mexican State, that the electoral body has.

Prior to the visit to SIATE, IFE officials, headed by the Electoral Adviser Lorenzo Cordova, Committee for Radio and Television President, and Commissioner Fernando Borjón, held a meeting to define the working groups and specify their duties to comply with the agreement signed between the two institutions.

IFE and IFT pledged to maintain technical cooperation in the field of monitoring of broadcasting media, the use of equipment, facilities and exchange of information and digital files belonging to the electoral body.

The Federal Telecommunications Institute (IFT) concludes the revision of the concession titles in force and creates the public register of telecommunications and broadcasting services concessions

• The regulatory body complies with the mandates included in fractions V and VI of the eighth transitory article of the Telecommunication Constitutional Reform Decree
• The Concessions Public Register will be available for general consultation; it includes relevant information on 3 thousand 323 telecommunication and broadcasting concession titles
• As the result of the concession titles revision, the Institute will implement other actions, additionally to those included in the Constitution

During the ordinary session celebrated yesterday, the Plenary of the IFT received from the Supervision and Verification Unit, and the Radio and TV Systems Unit, the report about the revision of the telecommunications and broadcasting services concession titles in force, responding to the provisions of fraction V of the Eighth Transitory Article of the telecommunication constitutional Decree, published by the Federal Official Gazette in 11th June 2013.

The aforementioned eighth transitory article establishes a term of 180 natural days, starting from the IFT conformation date, for this regulatory body to review the concession titles in force and verify the proper compliance of its terms, conditions, and modalities.

To comply with this provision, several work teams of the aforementioned units were created in order to perform a detailed revision process of all the files integrated by concessionaries. The results are as follows:

• Revision of a universe of 3 thousand 323 telecommunications and broadcasting concession titles in force.
• As for telecommunications, there are 2 thousand 038 concession titles in force,
• As for broadcasting, there is a total of 1 thousand 610 radio and TV stations grouped in 1 thousand 285 concession titles.

As a result of this revision, the IFT was able to generate updated information of these files, which will allow to have the updated compliance status of the concession titles and integrate the reception and classification process of the documents as a structural part of supervising actions.

Once the revision of the concession titles was finished, some information requirements emerged for operators whose files were not complete. Once such requirements were met according to the legal terms, a diagnosis is issued to establish regulatory improvement and administrative simplification mechanisms; and in case of possible breaches, the administrative sanction procedures begin based on the processes established and respecting the audience pledge.

Public Register of Concessions of Telecommunications and Broadcasting Services

Likewise, the Institute Plenary received the report of the Industry Service Unit on the integration of the Concessions Public Register, which includes the complete information of in forced concessions related to telecommunications and broadcasting public services, and according to the provisions of fraction VI of the eighth transitory article of the Reform Decree, which states the obligation of the Institute to collect the necessary information to constitute such Register.

In order to comply with this mandate, the IFT reviewed the open files of the different concessionaires included in the Telecommunications and Broadcasting Technical Record, as well as the information delivered to this Institute by the Ministry of Communication and Transportation.

This process, which implied the revision of a total of 3 thousand 852 files of telecommunications and broadcasting concessions in-forced and expired, allowed the integration and updating of all the information of the current concessions presently servicing telecommunications and broadcasting markets.

This is how the Public Register of Concessions was established and a digital platform was also designed to enable on-line and free consultation of the information by the general public at the IFT website: www.ift.org.mx

The Register contains all the relevant information of telecomm and broadcasting concessions (name of the concessionaire the date the concession was issued and its expiration date, its scope and authorized services, as well as its frequency bands and orbital positions, if applicable, and/or associated satellite systems, among other data), as well as the images of the documents supporting the corresponding data.

To establish the Public Register of Concessions it was necessary to integrate the aforementioned information with approximately 14 thousand related documents, 56 thousand digitalized images of telecomm concessions and 70 thousand images of broadcasting concessions, all this will be available for the general public next March 9^th.

The IFT Plenary approves the variables that will apply to the mobile interconnection cost model for the period of 2012 – 2014

 · The transparency of the resolutions that the Commission issues on mobile interconnection rates is strengthened

 · IFT orders the beginning of the review process for the methodology of cost models

 · It issues the Institute Transparency Council organizational and operational rules

 · IFT designates Commissioner Fernando Borjón as president of the Technical Committee of Portability

 · IFT approves modifications to capacity provision services on concession titles for microwave connections, with regards to the possibility of extension.

In extraordinary session, the Federal Telecommunications Institute (Instituto Federal de Telecomunicaciones, IFT) Plenary, unanimously approved the relevant variables that will apply to the Cost Model for Mobile services that will be used to resolve the non-stipulated interconnection conditions between public telecommunication networks concessionaires, pursuant to article 42 of the Federal Telecommunications Law for the 2012-2014 period. This determination will allow to quickly resolve the interconnection disagreements presented by the concessionaires to this regulating body.

The relevant variables of the cost model of mobile interconnection and the obtained results will be effective from January 1st, 2012 to December 31st, 2014. Within the approved variables, by means of Agreement P/IFT/EXT/291113/11, it was determined that the cost model of mobile interconnection will be based on an existing hypothetical operator in the long term, with a 33 percent market quota. This is going to offer certainty and transparency when calculating the rates that concessionaires will apply to interconnect their networks, which will fortify the decisions of this Institute.

On the other hand, it is important to note that this Institute is aware of the international debate that exists regards the accomplishment of interconnection approaches, as well as of the methodologies for cost models. In this respect, the European Community has pronounced the use of sole incremental costs, whereas other international bodies have debated on diverse approaches for interconnection such as El que llama paga (“Calling party pays”), make-whole agreements (Bill & Keep), fees based on the quality of the service and massive invoicing.

Due to the above, the Institute Plenary instructed the Regulatory Policy Unit (UPR) to a review process of the regulatory policy for interconnection issues during the first quarter of 2014. With this process the IFT recognizes the existence of the international debate in which Mexico cannot be isolated.

It is important to note that with this Agreement, continuity is achieved with a suitable regulation, precisely and impartially in interconnection issues, which promotes and facilitates the public telecommunications networks use, which entrance of efficient competitors in the market encourages, and incorporates new technologies and services and generates healthy competition between the participants of the market. The above will be translated in a direct benefit toward the users when granting them the opportunity to acquire more services at a lower price, higher quality and diversity.

IFT agrees to issue rules for the Transparency Council

Furthermore, the IFT Plenary decided, by means of Agreement P/IFT/EXT/291113/9, to issue the organizational and operational Institute Transparency Council rules, as well as 2 Press Release Number 11/2013 the procedures for the review and reconsideration pursuant to article 61, sections V and VII of the Federal Transparency Law and Access to Governmental Public Information.

This article establishes that the independent constitutional bodies, such is the Institute case, must have a procedure to the effect in which any person can promote a review or reconsideration recourse under the terms according to the law.

Pursuant to the IFT Organic Statute, the Plenary designated Commissioner Adriana Labardini as Transparency Council president, which will be in charge of resolving the recourses of review and reconsideration, as the case may be, the incidents of resolution breaches that occur, will promote transparency and access to information in the Institute and will require information from the responsible areas that allows the fulfillment of its functions.

The Transparency Council is authorized to issue recommendations on the policies of the Institute and programs in the matters of transparency and access to information.

IFT designates Commissioner Fernando Borjón to preside over the Technical Committee of Portability

On another note, during the past ordinary session, IFT Plenary designated Commissioner Luis Fernando Borjón Figueroa, by means of Agreement P/IFT/271113/21, to preside and coordinate the Technical Committee of Portability, as well as the Head of the Industry Services Unit, Rafael Eslava Herrada, as deputy for the President of this Committee. In addition, it named General Director of Telecommunications and International Subjects, Ante Salcedo González, as secretary to this Committee, and the General Director of Supervision, Felipe Alfonso Hernández Maya, as deputy. 3 Press Release Number 11/2013 Due to the relevance of the numerical portability scheme for the efficient development of telecommunications, the permanent approach with the suppliers of the service - within the sessions of the Portability Committee - is fundamental to comprehend the problems of the industry, enter into dialogues, promote consensus, and consequently, to make the best regulatory decisions, always in benefit of the user.

IFT approves modification to concession titles

Similarly, in the last ordinary session, the Plenary approved modifications to the eighth condition of provider capacity concession services for the establishment of microwave connections point to point and point to multipoint pertaining to the companies owned by Teléfonos de México, S.A.B de C.V., with Agreement P/IFT/271113/17; Nextel de México, S. de R.L. de C.V., with Agreement P/IFT/271113/18; and Inalam, S.A. de C.V., under Agreement P/IFT/271113/19, in order that these concessions have the possibility of being subject to analysis for the granting of the prorogation of their respective validity by IFT, authority with the exclusive attribution to determine the origin or not of this grant.

The eighth condition of the concession titles of these companies establishes that the assigned frequencies will be auctioned again at least three years before the concessions ongoing ends, which contravenes article 19 of the Federal Telecommunications Law, reason why the approved resolution today contributes to harmonize the rules of the effective normativity.

The Plenary approved for the referred titles of concession it is established that the concession could be extended totally or partially, according to IFT judgment, pursuant to Law and other applicable prescribed and administrative legal dispositions, for which, in its case, it will previously require the payment of a consideration, which amount will be taken into account, among other criteria, the bandwidth of the frequencies under concession, the geographic coverage of the concession and the services that the bands can provide.

With this concession titles of merit modification, IFT grants legal certainty to the concessionaires, which promotes the use of the infrastructure and stimulates the connection of networks for data massive transportation.

 The telecommunications sector grew 3.4 percent during the fourth quarter of 2013

• The broadband mobile connections increased by 46.6 percent, with respect to the same period in 2012, and came to a total of 16.56 million
• Incoming international long distance registered an increase of 27.6 percent, with respect to the same period in 2012
• Mobile telephony services presented an increase of 393 thousand subscriptions in the quarter, with which the base reached 103.6 million
• The service of restricted television reached a total of 14.7 million subscriptions, impelled mainly by the growth of 15.9 and 11.7 percent in the cable and satellite segments, with respect to the same period in 2012

During the fourth quarter of 2013, the Telecommunications Sector Production Volume Index (Índice de Producción del Sector Telecomunicaciones, ITEL)[1], which measures the behavior of the variations of the main variables of production of the telecommunications sector in the country, registered a growth of 3.4 percent in relation to the same quarter in 2012, figure superior to the growth of the Gross Domestic Product (0.7 percent) and which represents almost five times more than the economy as a whole, with which telecommunications continue to consolidate as one of the sectors that help to the growth of the country.

This way, the sector grew in annual terms to an average rate of 8 percent, in relation to the same period in 2012.

According to ITEL results, the services with better performance in the quarter were: incoming international long distance, registering a growth of 27.6 percent; cable television, with an increase of 15.9 percent; television via satellite, with an increase of 11.7 percent; provision of satellite capacity, with an equal adjustment to the previous quarter of 10.6 percent and mobile cellular telephony, with an advance of 5.6 percent, all measured year-on-year quarterly rates.

In recent years, new technologies offer a great diversity of services, every time more accessible for telecommunications users, replacing the existing services; derivative of this, operators are adopting new strategies to gain more market, also, the users have been specialized more and more in the knowledge and operation of the technologies causing a rising increase in their demand.

Restricted television

The service of restricted television, in its modalities, television via satellite, cable television and television by microwave, grew 13.4 percent during the fourth quarter of 2013, with respect to the same period in 2012.

The service of television via satellite or DTH registered a growth of 11.7 percent in the period, which, although significant, is the lowest registered since the second quarter of 2009. This modality totalized in 7.8 million subscriptions in the last quarter of the year, consolidating itself as the main technology for paid television.

Television by cable observed a greater growth in the quarter, with a rate of 15.9 percent, and concluded the quarter with 6.8 million subscriptions, which represent 46.3 percent of the total of restricted television users.

The number of subscriptions of television via microwave (Multichannel Multipoint Distribution Service, MMDS) services maintains its negative trend, falling by 11.5 percent at an annual rate in the last quarter of 2013 with respect to the same quarter in 2012. At the end of the period, this service had over 134 thousand subscriptions.

Mobile telephony

Mobile telephony service registered an increase of 5.6 percent in traffic minutes within the network during the fourth quarter of 2013. From September to December 2013, 393 thousand subscriptions were added, which represent a 3.9 percent increase with respect to the same period the previous year. The base totals 103.6 million subscriptions and represents 87 subscriptions for each 100 inhabitants.

With regard to the composition of the market by type of subscription, at the close of the last quarter of 2013, 16 million post pay users were reported, who represent 15.4 percent of the market total.

Whereas in the prepayment modality, the number closed at 87.6 million subscriptions, which represents a growth of 3 percent with respect to the same period in 2012, and 84.6 percent of the market total. 

The subscriptions of mobile broadband registered a growth rate of 46.6 percent with respect to the same period in 2012, with which the subscriptions base rose to 16.6 million.

Messages (SMS) sent by mobile cellular telephony networks decreased by 30.6 percent, with respect to the fourth quarter of 2012, which equals an average of 159 messages sent by subscription in the period, the lowest number registered since the second quarter of 2009, with a historical maximum of 252 SMS in the second quarter of 2012.

National long distance

During the reported quarter, the traffic measured in minutes grew 10.8 percent in regards to the same quarter of the previous year.

On its part, the average national long distance rate was 0.68 pesos per minute.

International long distance

During the quarter, the minutes of traffic of incoming international long distance increased by 27.6 percent with respect to the third quarter of 2012, result of the perspective of greater growth of the American economy.

For its part, the minutes of traffic of outgoing international long distance experienced a growth of 3.5 percent in the reported quarter, compared to the same period of the previous year.

The behavior of international long distance traffic in our country is related to the economic activity of the United States, given the integration of both nations, country with 98.8 percent of the incoming traffic and 88.1 percent of the outgoing traffic.

Trunking

During the last quarter of 2013, the number of users in this segment decreased by 39.8 percent with respect to the same period of 2012, which meant the lowest rate reported from the start of measurement of ITEL.

The users of specialized radio communication services (Trunking) are migrating toward state-of-the-art mobile telephony services, with 2.1 million users at the end of 2013.

Satellite provision

This segment registered an annual increase of 10.6 percent during the fourth quarter of 2013, equal to the rate reported in the previous quarter. The greater growth of this service can be explained, in part, by the startup of new satellites for public and private services. The unit of measurement for the provision of satellite capacity are Megahertz (MHz).

Local fixed telephony

The end of 2013 registered a total number of 20.6 million fixed telephone subscriptions, which represent 490 thousand lines above the same quarter in 2012, and corresponds to a yearly increase of 1.9 percent quarterly in that period. The tendency of this service to rise comes from the alternative suppliers of fixed telephony and from the cable television operators who incorporate the telephony service to their commercial offers. With these modifications in the fixed telephony market, the density of this service in Mexico in the fourth quarter of 2013 was 17.3 fixed telephone subscriptions for each 100 inhabitants.

Paging

With regards to the Paging market, the number of users continues with a decreasing tendency; during the last quarter of 2013, the number of users decreased by 33 percent, with respect to the same period in 2012, with 2 thousand 200 users.

Evolution of rates

The expansion of Internet services, the access to technology at better costs and the competition in the telecommunications market have generated that the concessionaires offer packages and promotions with more attractive rates every time, reason why these present a tendency to lower in nominal and real terms, which has allowed that more and more inhabitants of the country have access to these service

According to information from the National Institute of Informatics, Statistics and Geography (Instituto Nacional de Estadística y Geografía, INEGI), the prices of telecommunications services, measured based on subscripts that compose the National Index of Consumer Prices (Índice Nacional de Precios al Consumidor, INPC), showed important reductions during the fourth quarter of 2013.

This period showed a reduction of the subscript of prices of the telephone service in the order of 9.3 percent, in relation to the same period of 2012, which is composed of a decrease of 4 percent in the local fixed service, reductions of 3.8 percent both in the national long distance service and international long distance service, and contrary in this period, mobile telephony grew 45.1 percent.

As part of the subscript of other services calculated by the INEGI, reductions in real terms of 2.1 and 3.8 percent in the services of paid television and Internet are observed, respectively, compared to the same period in 2012.

It is important to mention that the measurements of telecommunications services prices made by the INEGI are within the objectives of the INPC, that is to measure the evolution in time of the general level of prices of the goods and services that urban homes of the country consume; in this sense, its representativeness is focused on a basket of goods and services that reflect the consumption patterns in homes2[2].

Final considerations

During the trimester of reference, it is observed that the tendency continues toward a moderate growth of fixed voice telephony services; which has been compensated mainly by the advance in the subscriptions of the broadband services that the fixed telephony companies can provide on their same telecommunications infrastructure.

The service of continuous mobile broadband, being one of the pillars of the growth of the telecommunications sector, growing at two digit rates in subscriptions, stimulated to a great extent by the reductions of rates and the development of applications for state-of-the-art mobile devices.

The restricted television market acquired a new dynamic from which the competition between operators and the new consumption patterns of the users who demand an ampler range of rate plans, accessibility and lower prices.

It is expected that during the following quarters, the tendency of growth of this industry is maintained, supported, partly, by the expectation of growth of the Mexican economy, from 3,4 percent for this year to 3.9 percent for 2015, and the expectations regarding the American economy, which expects a growth of 2.73 and 2.99 percent for 2014 and 2015, respectively.[3]

NOTE: The results in the present document come from data and estimations to the year 2013.