The sale of Movistar Mexico confirms the exit of one of the country’s most significant telecom incumbents, shifting the market toward a software-centric model. While the 2019 AT&T deal initially served as a survival tactic to curb losses, it ultimately functioned as a bridge to this acquisition. For the Mexican market, the entry of the OXIO consortium suggests that the future of competition lies in cloud-native flexibility and data monetization rather than the traditional, capital-intensive ownership of physical antennas and spectrum.

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A US-investor consortium led by OXIO Inc. and Newfoundland Capital Management reached an agreement to acquire Movistar Mexico from the Spanish telecommunications firm Telefónica. The transaction allows the mobile operator to maintain its brand and leadership while integrating OXIO’s cloud-native technology to modernize its service for over 20 million subscribers.

According to the consortium, the acquisition is intended to transition the mobile operator toward a cloud-native operating model using OXIO’s Telecom-as-a-Service platform. Following the close of the transaction, Movistar Mexico will retain its brand identity and current management team while integrating OXIO’s architecture to manage its subscriber base of over 20 million customers. “Movistar has built a strong brand with a loyal subscriber base of more than 20 million customers, and we are committed to building on that foundation. Our cloud-native platform will support the company’s transformation into a next-generation telco, while meaningfully improving the experience for subscribers across the country,” said Nicolas Girard, Founder and CEO, OXIO,

The deal follows Movistar Mexico’s multi-year shift toward an asset-light operating model. The consortium highlighted Mexico’s wireless market as a strategic priority due to the country’s growing demand for mobile-first services in sectors such as fintech and commerce, as well as its role in North American digital infrastructure. “Latin America has been at the core of our investment thesis since our founding, and Mexico’s wireless market is among the most compelling opportunities in the region today,” said Daniel Simon, Portfolio Manager, Newfoundland Capital Management.

The transaction remains subject to customary regulatory approvals and standard closing conditions. During the transition to the new technical platform, the parties stated that customer service will remain uninterrupted.

As reported in the transaction announcement, Mexico’s geographical position, specifically its 3169km border with the United States, creates unique cross-border connectivity dynamics. This positioning makes the country a critical node in North American digital infrastructure. Daniel Simon, Portfolio Manager at Newfoundland Capital Management, noted that these factors, combined with evolution in consumer and enterprise expectations, position Mexico for a new phase of telecom modernization. The transaction remains subject to customary regulatory approvals and standard closing conditions.

Telefónica’s Transition to an Asset-Light  Model

The acquisition of Movistar Mexico by the OXIO and Newfoundland consortium marks the culmination of a strategic pivot initiated years before addressing profitability challenges. As reported by MBN, Telefónica’s global strategy, defined in its 2026–2030 Strategic Plan, prioritized an orderly and value-creating exit from non-core Hispano-American markets to focus resources on Spain, Germany, the United Kingdom, and Brazil. In 2025, Marc Murtra, Chair, Telefónica, confirmed the completed sales of the company’s businesses in Argentina, Peru, Uruguay, and Ecuador, alongside a binding agreement to divest Colombia.

The foundation for this transition was laid in 2019 with a network-sharing agreement with AT&T Mexico. This deal allowed Telefónica to migrate its traffic to AT&T’s last-mile infrastructure, eventually enabling the company to return all its spectrum licenses to the Mexican government by 2022. 

By the end of 2025, Telefónica’s Hispam unit represented only 12% of the group’s total revenue and 7% of its EBITDA, reflecting a year-on-year decline of 33% in regional earnings. In Mexico, despite maintaining a loyal base of approximately 23 million users, the company faced persistent hurdles related to limited operational control and intensifying competition from Telcel and emerging Mobile Virtual Network Operators (MVNOs).

The move to OXIO’s Telecom-as-a-Service platform represents the final evolution of this strategy. By shedding traditional hardware and spectrum ownership, Movistar Mexico transformed into a digitally driven service entity. This leaner structure provided the “value-generating” exit sought by Telefónica Chairman Marc Murtra, allowing the brand to persist under new ownership while the parent company redirects its focus toward higher-margin sectors like cybersecurity, cloud, and AI through Telefónica Tech.

Movistar’s Market Share and the Rise of MVNOs

The acquisition comes at a time when Movistar Mexico has faced significant pressure on its market positioning. The operator has seen its market share in mobile lines decline steadily from 20.9% in 2020 to 13.8% at the close of 2024, as reported by El Financiero. 

A primary driver of this shift is the aggressive expansion of MVNOs such as Bait, Mega Móvil, and Diri. Running on the Red Compartida (Altán Redes), these players captured eight out of every 10 net new additions in the mobile segment during 2024, achieving a 59.7% growth in total lines. By the end of that year, MVNOs collectively surpassed Movistar’s market share for the first time, reaching a 14.9% stake and positioning themselves as the third-largest force in the Mexican mobile market.