América Móvil is confident that telecoms regulator IFT will find that the company has helped create a more competitive market, CEO Daniel Hajj said on a FY 2015 results call.
América Móvil is confident that telecoms regulator IFT will find that the company has helped create a more competitive market, CEO Daniel Hajj said on a FY 2015 results call.
After declaring the company’s fixed and mobile businesses – Telmex and Telcel – dominant players in March 2014, the watchdog is preparing to review how its reforms have reshaped the market two years on.
In 2014, Telmex had 80% of the fixed-line market and Telcel 70% of the mobile market. Media group Televisa, also declared dominant, had 70% of the broadcast TV market and 65% of the cable and satellite market. At the time, a 50% market share was deemed to be dominant.
“We are optimistic that [the IFT] will find more effective competition in the market,” said Hajj.
He said it was unclear how long the review would take, but that it was likely to take into account new competitors, the emergence of MVNOs, reduction in prices, the breadth of services available and whether the level of investment had increased.
Asked what América Móvil’s priority was during the review, Hajj responded: “There are some small commercial issues, such as what we have to give our customers that others don’t; asymmetric regulation and the price of unbundling.”
However, he said that given the current “energetic market, I think there will be market share for everyone, especially since penetration stands at 90%.”
In its official statement, the company outlined its position in the market: “With the entrance of a new international competitor [AT&T] in Mexico more than a year ago, competition has intensified between the three carriers and several MVNOs. At a global level, América Móvil is smaller than these competitors [AT&T and Telefónica] in terms of revenues, profits and enterprise value. Still, these two large enterprises are subsidised by América Móvil with asymmetric regulation. We have now very intense competition in Mexico that benefits our consumers.
The new competitor announced the integration of its Mexican operation to those they run in the United States for a total population of approximately 440 million inhabitants. From reviewing commercial information available from such competitor, we note that net prices —before taxes —of mobile services in Mexico are considerably lower than those in the United States.”