Mexico Telecommunications Report Q1 2016
BMI View: Regulatory changes against América Móvil's domination have made the Mexican market moreattractive to investors, as highlighted by AT&T's entry into the mobile market. It will also compete withTelefónica, bringing three international players into competition. The main areas of competition will beLTE services, with extra investments, and a North American single market. On the fixed side, convergencewill be the core driver, especially if América Móvil convinces the regulator to let it offer pay-TV.
Unbundling its network should help drive competition for broadband, but the quality of service remains anissue. Furthermore, making the incumbent's share drop below 50% will need some more regulatory work,such as divestments.
The Mexican mobile market has suffered volatility in recent quarters, with the latest major event beingAT&T's restating Iusacell figures. As of June 2015, there were 104.232mn subscriptions in the market
The broadband market is slowly improving its speed and quality of service, thanks to the growing numberof cable subscriptions, which reached 28.8% in Q115
The fixed voice market is expanding, reaching 20.92mn in Q115, driven by convergence. The success ofcable players has offset continuous losses for the legacy players such as Telmex and Axtel
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