América Móvil did not achieve its goal of entering the pay television market in Mexico this year, as it had expressly hoped the day before.
The Federal Institute of Telecommunications (IFT) rejected this Wednesday the project related to the incursion of Claro TV, a subsidiary of América Móvil, into the pay TV market.
The incursion of América Móvil would entail greater competition for AT&T Inc (T.N) and Grupo Televisa (concentrates 64% of the market), among other companies.
To promote its objective, América Móvil announced on Tuesday that it would increase its investments by 8,000 million pesos if it obtained the pay television concession in Mexico.
“We will invest 8,000 million pesos initially and in addition to the committed investment (from Telcel and Telmex),” Carlos Slim Domit, president of the company’s board of directors, said at the time.
América Móvil already has 70% coverage of the mobile internet services market in Mexico and more than 62% of mobile telephony services.
On the contrary, the United States Commercial Representation (USTR) is concerned that América Móvil will enter the pay television market in Mexico, the Reuters agency reported on Tuesday, citing an anonymous source.
“On January 12, US officials, including Deputy US Trade Representative (USTR) Jayme White, told the Mexican Ministry of the Economy and the Federal Institute of Telecommunications (IFT) that they were concerned about the entry of Claro TV from América Móvil to the sector”, according to the Reuters source.
In 2019, Claro TV submitted an application to enter the pay television business before the IFT.
The elaboration of a new project could lead to a new vote until 2023 or 2024.
Three of the five commissioners of the Plenary of the IFT (Ramiro Camacho, Sostenes Díaz and Arturo Robles) rejected the project that sought to deny Claro TV the concession to provide the service, considering that the document presented was deficient.
Commissioners Adolfo Cuevas and Javier Juárez would have voted against allowing América Móvil to enter the pay TV market.
For now, the company intends to further develop its current activities and, when opportunities arise, to make strategic acquisitions to continually increase its number of users, extend its leadership in providing integrated telecommunications services in the Americas Latin America and the Caribbean and grow in other regions.