AT&T Urges Changes to Mexico’s Industrial 5G Auction

AT&T México names four barriers in Mexico’s proposed industrial 5G spectrum auction, including high costs, restrictive participation rules, and limited financial transparency.

AT&T México has called on regulators to revise the rules for Mexico’s first spectrum auction designed specifically for private industrial 5G networks, warning that the current proposal could restrict competition, increase participation costs, and discourage investment.

The company submitted comments during the public consultation for auction CRT-RRI-01, asking the Commission for Telecommunications Regulation (CRT) to adjust the preliminary bidding rules before publishing the final terms. AT&T identified four main obstacles: Mexico’s high spectrum costs, the methodology used to establish spectrum accumulation limits, the exclusion of nationwide mobile operators, and the absence of key financial information.

AT&T did not request that the auction be canceled. Instead, it urged the regulator to improve its design and avoid an outcome similar to auction IFT-10, which recorded limited participation, or IFT-12, which the former Federal Telecommunications Institute (IFT) canceled before it could take place.

Auction Targets Private Industrial Networks

The CRT-RRI-01 process seeks to allocate spectrum for Capacity Provision Services for Intelligent Radiocommunication Networks. The frequencies would be used to establish private networks at factories, logistics centers, industrial parks, ports, mines, and other productive facilities.

Under the preliminary rules, the CRT would auction up to 240 spectrum lots in the 2.3GHz band. Each lot would contain 10MHz of bandwidth and concessions would remain valid for 10 years. The blocks would be distributed across 60 industrial or productive areas.

Private 5G networks can provide dedicated connectivity for automated production lines, sensors, robotics, autonomous vehicles, predictive maintenance, inventory management, and real-time monitoring. Unlike public mobile services, these networks can be configured around the coverage, security, latency, and capacity requirements of an individual industrial operation.

AT&T, however, argues that the proposed auction conditions would prevent some of the companies with the most network deployment experience from participating.

Spectrum Costs Remain Central Concern

AT&T’s first objection concerns the cost of using spectrum in Mexico, particularly the annual rights fees paid by concession holders. The company estimates that spectrum costs in Mexico are approximately 80% higher than the international average. AT&T argues that the largest financial burden is generally not the initial auction payment, but the recurring annual fees imposed for the use of the frequencies.

Those costs have already influenced operators’ investment and spectrum-holding decisions. Telefónica and AT&T have returned frequencies, while previous auctions have struggled to attract demand. AT&T asked authorities to significantly reduce annual spectrum fees across all bands, arguing that current conditions undermine the commercial viability of new bidding processes.

The company’s concerns build on objections it raised during the previous IFT-12 process. In June 2024, AT&T warned that allowing companies outside the telecommunications sector to acquire spectrum directly for private 5G networks could reduce operators’ business opportunities and affect service quality through greater spectrum fragmentation and interference, MBN reported.

The current CRT auction revives that broader debate, but AT&T’s latest submission goes further. In addition to questioning the direct allocation of spectrum for industrial networks, the company is now challenging the accumulation methodology, its exclusion from the process, and the lack of disclosed financial values.

Spectrum Cap Excludes AT&T and Telcel

A second dispute centers on the CRT’s proposed spectrum accumulation limit. Under the preliminary rules, operators holding more than 20% of the spectrum included in the regulator’s calculation would be prevented from participating. Based on that methodology, Telcel holds 33.5% and AT&T 26.2%, leaving both nationwide operators outside the auction.

AT&T challenged the calculation, arguing that the CRT only considered spectrum in the AWS, PCS, 2.3GHz, 2.5GHz, 3.3GHz, and 3.5GHz bands. It did not include the 700MHz, 800MHz, and 850MHz bands. When all spectrum bands identified for International Mobile Telecommunications are incorporated, AT&T estimates that its share falls to approximately 18.9%, below the proposed 20% limit.

The company said this does not mean it holds less spectrum, but that the regulator’s selection of bands changes how market concentration is represented. AT&T described the methodology as arbitrary and argued that accumulation limits should be established following a more comprehensive competition assessment by the National Antitrust Commission.

AT&T also warned that excluding nationwide private operators could create an uneven competitive environment, particularly if a state-owned company remains able to bid for all the available spectrum.

The operator argued that such a design could conflict with Articles 22.4 and 22.5 of the USMCA by creating a competitive distortion that favors a state-owned participant while removing potential private bidders.

AT&T’s fourth concern is the absence of essential financial information from the public consultation. The preliminary documents do not disclose the minimum reference value for each spectrum lot or the amounts participants would need to provide as bid guarantees. Interested companies may submit a stand-by letter of credit covering individual lots or all the blocks they intend to pursue, but the guarantee must equal 100% of the relevant minimum reference value.

Because the CRT has not published those reference values, potential bidders cannot determine the real cost of participating or fully evaluate the auction’s commercial viability. AT&T argues that omitting a central economic element during the consultation weakens the transparency of the process. It asked the regulator to disclose both the proposed values and the methodology used to calculate them before finalizing the auction rules.