Market Insight

Maz Tiempo starts MVNO operations in Mexico

August 26, 2014

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A new player, Maz Tiempo, has entered the Mexican mobile market. Maz Tiempo will offer its services as a mobile virtual network operator (MVNO) providing services through Movistar’s network. Another MVNO, Virgin Mobile, plans to invest $45 million to develop its operation.

Our Analysis

Maz Tiempo has launched its MVNO products in the Mexican market having received the government’s authorisation to provide MVNO services earlier in January 2014.  The company offers voice and data services and aims to reach between 1.5 and 3 million subscribers during its first year of operations. 

Maz Tiempo’s launch of mobile services follows Ekofon announcement of its intention to launch an MVNO operation under the Cierto brand. To differentiate itself from other operators, Ekofon has decided to target Mexican migrants’ relatives and foreigners living in Mexico. The company will rent Movistar’s network offering prepaid mobile services and aiming to reach 1 million subscribers in a 2-5 year period. Tuenti and Virgin Mobile are also present as MVNOs providing voice and data services using Movistar’s network. Given the rapid expansion of the MVNO market, Maz Tiempo will need to differentiate itself from its rivals to obtain and maintain a segment of the market. The overall dominance of América Móvil’s Telcel, with market share of 73% serves to make this task harder. 

In a related development, Virgin Mobile has announced that it plans to invest $45 million within the next 3-5 year period to expand its Mexican operation. This investment has the double objective to develop Virgin Mobile’s self-service platform and to improve the company’s positioning in the mobile market. Virgin Mobile launched its MVNO offer earlier in June 2014 and currently provides services in Chile and Colombia.

The Instituto Federal de Telecomunicaciones (Ifetel) has named América Móvil a “preponderant economic giant” and is imposing asymmetric regulations to attempt to reduce the company’s dominance of the telecoms market. A less competitive América Móvil should allow for opportunities for companies willing to invest in the Mexican market.

In addition to América Móvil, the new wave of MVNOs are competing with three incumbent mobile operators: Movistar Mexico with 19% of mobile share in March 2014, Iusacell with 4%, and Nextel Mexico with 3%. For América Móvil, the ideal situation would be an increase in the competitiveness of the MVNO market, rather than a stronger Movistar. 



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