Development of a bottom-up techno-economic model to calculate the costs of providing wholesale broadcasting services

Project executed on behalf of Mexican Instituto Federal de Telecomunicaciones (IFT)

Project Objective

Broadcasting network sites represent an essential facility for the provision of open TV services to consumers around the world. For this reason, in some countries, such as Mexico, regulators impose asymmetric regulation on the incumbent operators of the broadcasting sites, issuing, for instance, cost-oriented price control obligations.

Figure 1: Illustration of network elements involved in wholesale broadcasting services

In this context, the objective of the project was to develop, populate and agree with the industry a bottom-up LRIC model that would enable the Instituto Federal de Telecomunicaciones (IFT) to understand the costs of providing wholesale broadcasting services in Mexico.

Project Description

The project involved the development of the following activities:

  • Data requests to regional incumbent operators for broadcasting services in Mexico.
  • Development of a bottom-up LRIC model for determination of the wholesale access tariffs to the broadcasting access network of the Economic Preponderant Agent in Mexico.
  • Preparation of detailed documentation to guide the use of the model, as well as to detail its algorithms and features.
  • Public consultation with the industry on the cost model.
Figure 2: Overview of the structure of the cost model developed

Key Takeaways

Through this project, the IFT obtained a cost model that will enable it to set wholesale tariffs for access to the broadcasting access network of the Economic Preponderant Agent in Mexico.