Mexico Local Telephony Services Market Market Offers Ample Opportunity to Competitors and New Entrants Latin American Telecom Analyst Team Frost & Sullivan “The highly controlled basic telephony services market in Mexico is largely dominated by one service provider - Telmex - and is characterized by low competitive levels.”

“In expectation for the outcome of the new Mexican Telecommunications law, many companies, some of them existing providers with other services, are expected to enter the local telephony services market, fueling competition and directly impacting pricing, quality of service and coverage, thus expanding the total addressable market and overall improving and increasing total revenues.” Industry Trends

Current local Telephony Market offers ample opportunity to Competitors and New Entrants. New telecommunications regulation to open local services market for other providers. Mobile telephony’s replacement of local service may be coming to an end. Industry Trends (Cont’d)

Detailed analysis of the potential business and residential sector market along with a concise assessment of potential market. Discussion of the main factors within the new telecommunications law, as it pertains to the local telephony services market. Local telephony services openness by unbundling of the last mile access network should provide opportunities for existing and new market participants. Analysis of the potential schemes upon which the new telecommunications law will execute the last mile unbundling process and potential outcome. Key Features

Growth Opportunities Primary Research Competitive Analysis Information on Emerging Trends What We Offer

“Currently most of the competition in the local service telephony market in Mexico is limited to the largest metropolitan areas, where new competitors with lower investment can reach the largest number of potential consumers. Telmex on the other hand has and will continue expanding its last mile access infrastructure deployment outside suburban areas, where competition is minimal (if any) and accumulated demand is abundant. Future plans for the company seem very profitable, where its urban last mile access network should generate funds by leasing it and its maintenance to different competitors fighting for the urban consumers and the rural network, should generate profits by servicing the end user.” Who Will Benefit?

Alcatel S.A. Alestra S.A. de C.V. Avantel servicios Locales S.A. Axtel S. A. de C.V. ITXC Corp. Lucent Technologies, Inc. Marcatel S.A. de C.V. MaxCom Telecomunicaciones S.A. de C.V. MegacableComunicaciones de México S.A. de C.V. - (Megared) Miditel S.A de C.V. Motorola, Inc. Nortel Networks Ltd. Panasonic/ Matsushita Electric Corp. SBC Communications, Inc. Telefonica Latinoamerica S.A. Telefonos de Mexico (Telmex) S.A. de C.V. Unefon S.A. de C.V. Verizon/Iusacell Key Market Participants

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