In mid-August, the MTC decided to initiate the unilateral resolution procedure of the RDNFO license communicating the decision to Azteca. As Convergencia could find ou, the Mexican company responded by declaring itself "surprised" by the measure, but the Peruvian government will advance with the next step, which consists of publishing the calling notice to public hearing in the Official Gazette El Peruano. In this way, the MTC puts into practice what is stated for contracts entered into under the Public-Private Partnerships (PPPs) law, which establishes a detailed procedure for unilateral resolutions.

The government ministry had to choose this path because it considered the conditions specified by Azteca in its end-of-2019 addendum to be risky and against the public interest, for a “friendly” exit. At the beginning of 2020, Azteca's proposal was analyzed by the MTC, the Ministry of Economy and Finance, the Comptroller General of the Republic, and Osiptel. MTC counterproposal delivered in June included an asset verification and reversal process, multiple small and large observations on the network's deployment, and a rejection of Azteca's proposed addendum for numerous reasons. The most important of them has to do with the Guarantee of the Carrier Service Provision Phase and the amount of the guarantee. Azteca proposed an amount of US$5.38 million to guarantee the results of an arbitration award related to the cost of the project's land and/or buildings, but for the Peruvian State, this amount is insufficient to guarantee the State coverage of these lands. The MTC's counterproposal was to set this amount at US$17.37 million.

Once the call to the public hearing is formally published, it will be submitted for 30 days for comments. The hearing is expected to take place in November. If this instance is passed in a favorable manner, six months must elapse until the termination of the contract, as stipulated in RDNFO contract with Azteca, whereby it could only occur in March or April 2021.

While the deadlines established by law are met, and a new model for the RDNFO is settled, either for a sole licensee or for a network licensed by parties, Pronatel will hire an operator to run and maintain the laying. From the MTC they seek to leave the process "on track", which will inexorably be inherited by the next administration, once Vizcarra's management is finished in mid-2021.

For the government ministry, it is urgent to end the process to avoid further delays and fully address the reformulation of the RDNFO model. Especially to re-float regional broadband projects, today extremely useful to accompany the new connectivity needs in all homes of the country through tele-education and tele-work.

The MTC has already started a path of no return around the relationship with Azteca. And it faces it urged by the time that the process will demand –as stipulated by the Law of Public-Private Associations (APPs) - and aware that any bureaucratic delay affects the broadband access market in general. The RDNFO contracting conditions –especially the value of the rate-, continues to impact the wholesale segment in general, to the point that it is convenient to contract other providers (Telefónica, for example), which deployed networks on a par with that of Azteca. The situation described in previous reports, related to the laying underutilization, persists and lasts as long as the license contract is not terminated, and in parallel the advances with the regional networks are wasted, which would have been of vital help in the framework of the pandemic and the new access needs.

According to the Instituto Nacional de Estadística e Informática (INEI) (National Institute of Statistics and IT), 62.9% of households in Metropolitan Lima had access to internet service between January and March 2020. The estimate is close to that of the Encuesta Nacional de Hogares (Enaho) (National Household Survey), for the same period of time, which indicated that 59.7% of households in Lima had some type of internet connection. However, in other departments the connectivity situation is very uneven, such as Cusco (14.8%), Cajamarca (6.9%) and Huancavelica (6%), despite the fact that they have 25, 24 and 19 RDNFO nodes, respectively.

As stated by the MTC in Legislative Decree 1502, on the increase in the use of RDNFO in the framework of the health emergency, “whether or not Azteca Comunicaciones exits, the Government must be prepared to work under another attractive and sustainable business scheme. Law 29904 must be reviewed and incorporate what has been learned, but, above all, internalize the dynamism of the telecommunications market, technology and digitalization. Also, it is necessary to think about the RDNFO and regional networks in an articulated way in the planning process. The MTC cannot risk proposing a new model that ends up being obsolete in the next 5 years”.