Feeds

Save Mexico: Stop druglords, violence ... and that DRATTED MOBILE DUOPOLY

Watchdog orders mega-firms: share infrastructure with rivals

Providing a secure and efficient Helpdesk

Mexico's government was told that next to the country’s endemic level of organised crime and associated violence fuelled by the drug trade, its mobile duopoly was one of the major hindrances to its economic growth. So it decided to act against both.

Mexico’s sensational growth in pay TV and telecoms has been distributed largely between two dominant players, Televisa and America Movil.

To combat the duopoly, the government – led by President Enrique Pena Nieto – took the key step in June 2013 of abolishing the relatively toothless longstanding telecoms and pay TV regulator Cofetel and replacing it with the Federal Telecommunications Institute (IFT). IFT was given new powers to force companies to share infrastructure, sell services at fixed prices and even in some cases enforce an asset sale or breakup.

Th new regulator has not taken long to unleash these weapons against Televisa/America Movil, which the government sees as concentrating commercial power too greatly in the hands of two oligarchs, Televisa’s Emilio Azcarraga and America Movil’s Carlos Slim – even if the latter is a noted philanthropist.

While no asset sales have yet been mooted, IFT has ordered both companies to share their infrastructure with competitors in a bid to stimulate competition. America Movil will also have its phone prices regulated, while Televisa, the nation’s biggest broadcaster, will have to let competitors share its DTT towers for a set fee. It must also publish its advertising prices.

Such measures will not have an immediate impact on market shares and it is doubtful whether this will be significant even in the longer term, without other measures to dent the power of the big two.

Calculating market shares in Mexico is notoriously difficult because methods of counting vary between operators. America Movil has traditionally reported chiefly in RGUs (Revenue Generating Units) in what looked like a deliberate attempt to obfuscate the situation and exaggerate its pay TV numbers by counting some homes twice or even three times. At any rate it made it hard to break numbers down into pay TV, broadband and mobile.

It is clear that in pay TV Televisa is highly dominant, with almost 70 per cent of the 14.6 million total subs reported by IFT for Q3 2013. This includes the circa 4 million DTH subs for Sky Mexico, which is 58.7 per cent owned by Televisa and 41.3 per cent by DirecTV – the rest is made up of cable TV companies such as Cablevision that are wholly owned.

America Movil’s main strength in Mexico is in fixed-line telecoms – with 80 per cent of the market via its Telmex unit – and in mobile: with 70 per cent through its Telcel subsidiary.

Across Latin America as a whole, its pay TV business has been soaring to overtake the leader DirecTV by some counts. America Movil says it had 16.4 million pay TV subs in Latin America at the end of 2013, a 22 per cent year-on-year increase, with 5.5 million of those through its cable TV subsidiary Net Servicos of Brazil.

Copyright © 2014, Faultline

Faultline is published by Rethink Research, a London-based publishing and consulting firm. This weekly newsletter is an assessment of the impact of the week's events in the world of digital media. Faultline is where media meets technology. Subscription details here.

Security for virtualized datacentres

More from The Register

next story
TEEN RAMPAGE: Kids in iPhone 6 'Will it bend' YouTube 'prank'
iPhones bent in Norwich? As if the place wasn't weird enough
Consumers agree to give up first-born child for free Wi-Fi – survey
This Herod network's ace – but crap reception in bullrushes
Crouching tiger, FAST ASLEEP dragon: Smugglers can't shift iPhone 6s
China's grey market reports 'sluggish' sales of Apple mobe
Sea-Me-We 5 construction starts
New sub cable to go live 2016
New EU digi-commish struggles with concepts of net neutrality
Oettinger all about the infrastructure – but not big on substance
PEAK IPV4? Global IPv6 traffic is growing, DDoS dying, says Akamai
First time the cache network has seen drop in use of 32-bit-wide IP addresses
EE coughs to BROKEN data usage metrics BLUNDER that short-changes customers
Carrier apologises for 'inflated' measurements cockup
Comcast: Help, help, FCC. Netflix and pals are EXTORTIONISTS
The others guys are being mean so therefore ... monopoly all good, yeah?
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
The next step in data security
With recent increased privacy concerns and computers becoming more powerful, the chance of hackers being able to crack smaller-sized RSA keys increases.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.