In November 2019, the two companies originally announced the start of this wholesale agreement on the use of cellular networks.

The telephone companies AT&T and Movistar agreed to a six-year extension, until 2030, of an infrastructure sharing agreement, by which all the traffic generated by Telefónica users in Mexico travels through AT&T's cellular networks, and that to Movistar saved money because it allowed it to get rid of expensive spectrum frequencies that it no longer needed, while for AT&T this deal became its main wholesale income that increased the profitability of its telecommunications network.

In November 2019, the two companies announced the start of this wholesale agreement on the use of cellular networks.

The context then was that a high tax burden for the exploitation of frequencies for 3G services was drowning Movistar's finances, while AT&T could not find a way to generate value for its network that had cost it US$ 3,000 million, given that in addition company was becoming the company that was losing the most postpaid customers in the very concentrated Mexican mobile market.

Telefónica thus found oxygen to keep the operation of the Mexican Movistar afloat, while the corporate in Madrid found a buyer for those assets or the agreement with AT&T began to give results, whichever came first.

At the same time, AT&T became a wholesale network out of necessity, which from one year to the next handled the traffic of more than 40 million people in Mexico, including that generated by its own, that of Movistar and that of other mobile companies. virtual. AT&T today has seven virtual mobile clients, plus Telefónica and would be close to announcing a new client.

The context today thanks to this agreement is that Telefónica maintains more than 20 million customers in Mexico and this unit has become its largest cellular business in Spanish-speaking Latin America, in addition to being the company that postpaid won at the end of 2023, at the same time that it returned frequencies for 3G and 4G services, and can now access the 3.5 GHz band, ideal for 5G, from AT&T and thus sell this type of services from the network of its commercial ally .

AT&T, for its part, has become an operator with a cellular network through which the communications of as many people pass as the entire population of Argentina and is in a position, according to its financial statements, to go for more 5G radio bands. to compete with Telcel and retain Movistar. In fact, AT&T is obliged to have its infrastructure in optimal condition and with available spectrum, if it does not want to lose that customer.

The challenge for the two companies continues to be the average monthly consumption presented by their clients, of 90 (US$ 5.2) and 141 pesos (US$ 8.2), when Telcel's rose to 176 pesos (US$ 10 ,2).

And both also go together in their regulatory policy positions, since the two companies promote that Telcel be tightened more and in the same way in the shared use of infrastructure.

“Telefónica Movistar's operation in Mexico has strengthened its business model through alliances to share infrastructure, with agreements such as the one entered into with AT&T, which allows it to maintain its status as one of the main mobile operators in the country, providing services to residential, business and wholesale customers (…). The company has achieved a more efficient network deployment that leads to greater connectivity in a sustainable way, as well as contributing to the country's digital transformation and inclusion,” Telefónica clarified.

“The extension of this agreement confirms the commitment of both companies to the country and their desire to continue contributing to the development of the telecommunications sector in the country (…) The extension of the agreement strengthens the ability of each of the companies to compete in a highly concentrated market, and is a sign of trust between two companies committed to continuing to grow in the telecommunications sector to bring connectivity opportunities to more people in the country,” stated AT&T.

In financial matters, Telefónica and AT&T signed this wholesale agreement, with the perspective that Movistar would generate savings of 5,000 million pesos (US$ 291 million) starting in 2022 in Mexico. It is unclear how much money Movistar pays AT&T. That company had, for example, revenues of US$ 1,409 million in 2023.