Under the order, Telmex has been required to cut its interconnection rate from 11.55 Mexican cents (MXN) per minute to 3.951 MXN per minute, a decrease of 65.8%.
The cuts are even greater in rural areas, where Telmex has to cut charges by 94%, from 75 MXN to 4.53 MXN. It argues that this is a long-distance service provided to competitors who are making no investment in these regions, and that “it establishes an interconnection rate that is not based on the real costs of the company”.
Telmex, which controls around 80% of Mexico’s landlines, argues that it had negotiated a concession with COFETEL, that: “forces COFETEL to make sure that concessionaries pay Telmex the complete cost allocation of all that is necessary to maintain and establish interconnection”.
Telmex has issued a statement, claiming that “such decisions are clearly unexplainable” and “ignore the real cost of providing the service”. It does not believe that these reductions will translate to a price reduction to consumers.
The company has stated that it will apply the interconnection rates established by COFETEL, but that it intends to “carry out all the relevant legal defense actions” against these reductions.
