A vote by Mexico’s telecoms regulator concluded on Wednesday without granting authorization to telecoms giant America Movil to enter the country’s pay-TV market, according to a source with knowledge of the process.
The vote means that for now, America Movil, controlled by the family of Mexican billionaire Carlos Slim, will remain without a license to enter pay-TV. The prospect of its getting one has caused major concern among companies operating in the sector.
The Federal Telecommunications Institute (IFT) was voting on a proposal to deny America Movil’s request for its Claro TV business to enter the sector.
Two of the IFT’s five commissioners voted in favor of denying the company’s concession, while three commissioners voted not to support the proposal, arguing that it contained “procedural defects,” the source said.
“Although the three (commissioners) clarified that this did not mean that at the time they would vote to grant the concession,” the source said, adding, “There’s no certainty of a new proposal.”
Ultimately, the matter does not appear to have been formally resolved.
America Movil declined to comment. A spokeswoman for the IFT did not immediately have a comment.
Ernesto Piedras, head of Latin American market consultancy The CIU, called the outcome of the IFT vote “magnificent news for the telecommunications sector as a whole, competing operators and consumers.”
Far and away the biggest telecom player in Mexico, America Movil has been barred from providing the service in its homeland since the privatization of state phone company Telmex in the early 1990s, which later evolved into America Movil.
Deemed a “preponderant agent” by the IFT due to its large market share, America Movil has had the permit withheld.
Ahead of the vote, the United States had raised concerns to Mexico about the implications for competition if America Movil enters the TV market, Reuters reported on Monday.
America Movil executives said Tuesday they were seeking to meet with U.S. officials and argued that entering pay-TV would boost coverage, penetration and connectivity in the market.
Mexico’s Telecommunications Law Institute (IDET), a civil organization, hailed the IFT vote, and called on regulators to continue prohibiting America Movil from pay-TV because it would “harm competition to the detriment of millions of users.” Reuters