Public Tender for 1.7 / 2.1 and 1.9 GHz Spectrum

 A Direct Impact Assessment, Tax Collection and Multiplier Effect

In a country with a telecommunication infrastructure deficit such as Mexico, the implementation of public policies, such as spectrum public tenders 20 and 21, introduces continuous benefits to the economy as a whole.

The design of these public tenders favors the competitive environment in a highly concentrated sector, while its instrumentation has important and positive results for the market, together with impacts on legal certainty for the main actors.

In addition, the benefits are shown in the form of additional fiscal revenues for the State, as well as improvements in social welfare resulting from increased competition and lower prices on the one hand, as well as productivity increases in the use of these services, productive investment, generation of jobs in the deployment and operation of networks and the provision of new generation services.

For this, a financial model was made to calculate the benefits that will be obtained by the allocation of 30 MHz of spectrum, the use of the same and the profit of the society. With these results, the spectrum value is obtained given the current public tender rules, and in that way, it adds more analysis elements to the discussion.

In the short term, the public tender for concessions on the exploitation of a property owned by the Nation (the radio electric spectrum) generates a revenue benefit for the Government.

Consistently, in the medium and long terms, a significant increase in the flow of social benefits is generated, as the amount of spectrum in use increases; the concentration within the industry tends to decline as competition increases with its consequent redistributive effects.