An interesting wrinkle has developed in Mexico's competitive mobile landscape. Ever since AT&T Mexico launched its 4G network in 2015, it has gone head to head with Mexican giant Telcel in our metrics. In our earlier Mexico reports , AT&T established a big lead in LTE availability, and it began challenging Telcel in our 4G speed results, keeping the incumbent on its toes. But in our latest test period, AT&T's speeds have dropped considerably. Telcel has now established a healthy lead in three of OpenSignal's four speed metrics. AT&T is still the leader in 4G reach in our results, but when it comes to our 4G speed and latency awards, Telcel is reasserting itself as Mexico's dominant operator.

In our latest look at Mexico's mobile market, we analyzed more than 1.8 billion measurements collected from nearly 126,432 devices from June 1 to Aug. 29, 2018. We compared how Mexico's three major operators — América Móvil's Telcel, AT&T Mexico and Telefónica's Movistar — stacked up in 3G and 4G on the national level as well as in the country's largest cities. Let's start first with our speed metrics, where we saw the most dramatic shifts since our last report.

AT&T's average speeds are dropping

Telcel took three of four speed awards for the first time, even though we saw practically no change in its 3G and 4G download connection averages since our last report. It won our 4G download award with an average speed of 26.1 Mbps and our 4G upload speed award with an impressive score of 11.4 Mbps. We also recorded a 1-Mbps uptick in Telcel's overall download speed, bringing its average to 16.3 Mbps and allowing it to wrest the overall speed crown away from AT&T. The reason Telcel was able to jump forward while practically standing still was AT&T's precipitous drop in our speed metrics.

Our measurements show that AT&T's average 4G download speed fell more than 6 Mbps to 15.2 Mbps in the last six months, putting it in last place behind Movistar's average of 17.3 Mbps. AT&T also came in last place in our 4G upload category with an average speed of 7.3 Mbps. Though our overall download speed award went to Telcel in this report, AT&T did maintain a slight edge over Movistar in our results with an average connection of 10.5 Mbps. Movistar's tested 4G speeds may have been faster, but AT&T's high level of LTE reach was the determining factor: AT&T customers were able to find LTE connections more often. Our final speed category, 3G download, was AT&T's saving grace. Even though its high HSPA download score took a hit, falling by nearly 1 Mbps to 3.6 Mbps, it was able to hold onto first place in the category, just beating out Telcel.

AT&T's networks didn't suddenly lose capacity or become less powerful so the severe declines in speed we see are difficult to explain. But there was one interesting development in the last six months that could have potentially impacted speeds. In the spring, AT&T introduced new prepaid plans under its Unefon brand that offer unlimited data for prices as low as 10 pesos (US $0.52) a day. There is a pretty big catch to those plans, however. Customers who sign up for them are limited to download speeds of 5 Mbps, and after 5 GBs of usage each day, speeds are further throttled down to 1 Mbps.

Such restrictions would normally have a huge impact on our speed metrics, but that doesn't appear to be the case here. In our results we separate out Unefon users from AT&T Mexico's main postpaid customer base, so the measurements collected by AT&T subscribers in this report don't include measurements from Unefon users facing the new speed caps. But it's possible we're seeing an indirect impact on AT&T's overall 4G capacity due to these new prepaid plans. Both prepaid and postpaid users share the same LTE network, and the success of these new unlimited plans may be increasing the average amount of data consumed per subscriber, eating up capacity for all users — prepaid and postpaid alike. As networks become congested, average speeds can fall for all users.

While AT&T's average speeds may have suffered in our results, the drop had no effect on its impressive 4G network reach. AT&T won our 4G availability award as our users were able to find its LTE signals 81.3% of the time. AT&T remains the only Mexican operator to maintain a 4G availability score above 80% in our measurements. That said, growth in 4G access does seem to have stalled in Mexico. We recorded practically no movement in our 4G availability metrics for all three operators over the last six months. In our final category of metrics, latency, Telcel held onto its lead, winning both our 3G and 4G response-time awards for the third time in a row.

Telcel shines brightest in the cities

In our analysis or Mexico's biggest cities, Telcel definitely emerged as the dominant player in our metrics. It was the undisputed winner in our 4G download speed metric in eight of the 10 cities we analyzed and the uncontested winner in overall download in seven of those markets. AT&T was highly competitive in Aguascalientes and Juárez where it tied with Telcel for both our 4G download and overall download awards, as well as in Monterey where it was tied for the lead in overall download. In 4G latency, Telcel had a strong showing, winning our best-response-time prize in seven cities, though Movistar asserted itself in Aguascalientes, Juárez and San Luis Potosí.

4G availability was our most contested regional category. Though AT&T was well ahead of its competitors nationally, in Mexico's three biggest cities it fell short of an uncontested lead in our results. Telcel, Movistar and AT&T were tied for our 4G availability award in Guadalajara — all with scores over 80% — while Telcel drew with Movistar in Monterrey and was the sole winner in the biggest metropolis of them all, Mexico City.

Mexico is definitely a country to watch in the coming year as the competitive dynamics in its mobile market are clearly changing. With its new unlimited prepaid plans AT&T is challenging incumbent giant Telcel for the business of Mexico's budget-minded prepaid segment, which could open AT&T's subscriber rolls to millions of new customers. But if AT&T's speed results keep dropping it may well have to sacrifice its technological prowess in the process.