Telco giants fail to damage Mexican pay-TV


Details

Juan Fernandez Gonzalez

| 02 April 2016




After almost two years of regulation to reduce the dominance of América Móvil (Telmex, Claro) and Televisa in Mexico’s telecom market, analysts fear it’s too soon to believe that competition has been restored.



telecomunicaciones“We see the IFT [Mexico’s telecom regulator] is considering allowing América Móvil to enter the pay-TV market, thus breaking its own ban established in the regulation against preponderance,” stated analyst Ernesto Piedras from the Competitive Intelligence Unit.

According to his report, the latest figures reveal marginal improvements in terms of competition. By the end of 2015, América Móvil had a 68.4% share in the mobile market, barely 2.2 percentage points less than in March 2014, when the asymmetric regulation was approved. Regarding fixed lines, América Móvil still owns 66.7% of the market.

The same scenario is found in the pay-TV segment, but with other players. With América Móvil banned, for now, from entering this market, Grupo Televisa is still the clear leader, both through its satellite (Sky) and cable operations.

For Piedras, if the IFT intends to increase effective competition, it shouldn’t allow América Móvil to expand its near-monopoly. “The regulator’s argument is probably that asymmetric regulation has been obeyed, but figures show rules haven’t been enough nor effective,” he pointed out.

Carlos Slim’s telco has repeatedly shown intentions of asking for a pay-TV licence in 2016, as the company also understands competition is now healthier in Mexico.