Satmex files for Chapter 11 protection

Published: Thursday, April 7, 2011 16:03 (GMT -0400) By Business News Americas staff reporters   Mexican, former state-controlled satellite company Satmex has filed for bankruptcy protection for itself and two subsidiaries – Alterna TV and Alterna TV International – in a … Continue reading

ANALYSIS Televisa’s investment in Iusacell a win-win for the Mexican telecoms sector

Monday, April 11, 2011 15:56 (GMT-0400)
The deal announced last Thursday (Apr 7) in which Mexican broadcast giantTelevisa will buy a 50% stake in mobile operator Iusacell for US$1.6bn will have far reaching implications for competition, regulation and services in the country’s telecommunications sector.

From the perspective of the two companies involved, it appears to be a win-win scenario.


Iusacell has never been able to get into second gear in the mobile telecoms market, and for years has wallowed with a 4-5% market share and a far third in a three-player race. In recent months, its strategy has been not so much to try to innovate and go forward, but rather to prevent others from doing so, via the courts.

The company did its darnedest to prevent authorities from handing over mobile spectrum won by a consortium of Nextel and Televisa late last year. While license was finally handed over, the hassle caused by Iusacell seemed to be a contributing factor to the consortium falling apart shortly after.

It is ironic then that several months later that Televisa, the very company that Iusacell spent so much time and effort to frustrate from getting into the mobile market, has done just that by becoming a joint owner of Iusacell.

The benefits for Iusacell are as clear as day. Putting in order the operator’s financial situation is a priority. Despite being owned by one of Mexico’s richest men, Ricardo Salinas Pliego, Iusacell has battled with debt problems for years. And it is not surprising that of the US$1.6bn that Televisa will invest, US$1.57bn will be for taking on Iusacell’s converti ble debt.

Iusacell gains a sponsor with deep pockets to invest in introducing new products, expanding the GSM overlay of the operator’s mainly CDMA network, and getting back into the market all through a partner with an extensive distribution network and a range of other products to package together.


Besides being one of the largest Spanish-language broadcasters, Televisa has been building itself up in the telecoms and cable TV market for a number of years. The company most recently bought up the 41.7% of shares in cable TV operator Cablemás that it did not already own for 4.7bn pesos (US$397mn).

The company also has other cable and satellite assets and is part of a consortium that includes Telefónica and Megacable and that won a concession to operate dark fiber last year.

Mobile was the part of the puzzle that it had lacked. The alliance with Nextel did not work out, but the Iusacell option looks much better. Iusacell is an established operator in the market with a surplus of unused spectrum. It has a niche clientele and an advanced 3G network with value-added services. All of this at least puts Televisa on the first rung of a very long ladder. Mexico’s mobile telecoms sector is dominated by Telcel with 70% of the market and Movistar with 23%.

Televisa will also bring slick new management to the operator.

And most importantly, mobile gives Televisa the opportunity to offer what nobody is offering at the moment in Mexico: quad play. Telmex is still prevented from offering television. Televisa has the potential to offer a very attractive package of internet, pay and open TV, and fixed and mobile telephony, and wrap around all that its exten sive content network, which at the end of the day is where telecoms’ future lies.


Analysts envisage few regulatory obstacles to the deal if it goes ahead. This is Televisa’s first mobile asset, so it would not cause competition problems on that front. Ironically, in getting into bed with Salinas Pliego, Televisa is getting very close to its main rival in the TV stakes, TV Azteca, which Salinas Pliego also owns.

However, in the light of Televisa’s above mentioned ability to offer quadruple play, sector watchdog Cofetel is likely going to have to take a fresh look at the competitive scenario rather quickly.

Telmex (NYSE: TMX) cannot be kept out of the TV market forever, and now with a seemingly new telecoms superpower in the making, the argument that Telmex would dominate if allowed to compete in that space perhaps no longer holds any water.

And regulation would have to be across the board to ensure a level playing field for all.

Operators like Telcel and Movistar are likely going to rethink their strategies and prepare to battle with a new type of beast, the first one that can truly offer a modern, fully convergent, integrated telecoms and media service.

Perhaps this is the game-changing move that Mexico’s telecoms sector – so long bogged down in the quagmire of lawsuits, political bickering and influence peddling – was waiting for and will put the power back into the hands of the consumer.
By Patrick Nixon
Business News Americas


Samsung looking to capture local tablet market with Galaxy line

Published: Monday, April 11, 2011 17:49 (GMT -0400)

By Business News Americas staff reporters


Tablet sales could reach around 200,000 in the Mexican market this year, local media outlet Infochannel reported Samsung Mexico’s senior sales manager of commercial channels, Javier Carsi, as saying.

According to Carsi, Samsung will aim to capture this market with new products from its Galaxy Tab line, utilizing local wholesalers.

Currently, five wholesalers in Mexico have placed orders for Samsung’s new tablets. The wholesalers include CT International, Grupo CVA, Ingram Micro,Intcomex and TechData, and they will work with resellers to offer the products to clients.

Carsi highlighted that other companies, besides the current wholesalers, will be able to market the tablets as well. He said the company aims to give all channels access to the product so it can compete in terms of price, quality and performance.

According to Carsi, each wholesaler marketing the product will receive support from Samsung to train channels on the platform offering. Samsung also plans to participate in activities with interested distributors to inform them about the line of products.



Vesta launches payment services for Telcel customers

Published: Monday, April 11, 2011 15:28 (GMT -0400)

By Business News Americas staff reporters


US electronic payment solutions provider Vesta Corporation has launched its mobile recharge services for Mexican mobile telephony operator Telcel, according to a press release from Vesta.

According to Vesta, its payment services for Telcel’s prepaid mobile products allow customers to pay for airtime, data plans and other services without having to visit a retail point of sale.

Web payment is Vesta’s first offering for Telcel customers, allowing them to fund their prepaid broadband accounts on the internet using a credit card. Through a Telcel-branded website, Vesta will manage payment requests, validate cardholder data and deliver real-time account credits.

In the coming months, Telcel will extend Vesta-powered reloads to include prepaid wireless plus IVR, WAP, live agent and text-to-refill charges. Other Vesta products being considered for implementation include Auto-Pay, which allows customers to regularly top up their accounts based on a specific date or available balance.

Vesta said it will fully cover Telcel for any transaction-related fraud, while also protecting consumer credit card data through full PCI compliance.



Moody’s affirms Televisa’s ratings after Iusacell investment announcement

Published: Monday, April 11, 2011 16:50 (GMT -0400)

By Business News Americas staff reporters

Moody’s has affirmed Mexican broadcast giant Grupo Televisa’s Baa1 and Aaa ratings with a stable outlook, after the company announced its up to US$1.6bn investment for a 50% stake in mobile operator Iusacell, according to a press release from the ratings agency.

The investment’s size and structure do not affect Televisa’s current ratings, because the company had set aside cash for long-term strategic investments; as such, the transaction does not compromise the group’s future cash flows, Moody’s said.

The ratings agency considers the investment strategically beneficial in the long term, providing Televisa with business opportunities in the mobile telecoms industry. Moody’s said the investment is expected to allow Televisa to leverage its infrastructure and launch the first major quadruple play services package in Mexico.

Moody’s VP and senior analyst Nymia Almeida said the agency will continue monitoring any future investments, as they could jeopardize Televisa’s business or credit profile beyond normal levels.

Further investment activities could put pressure on the ratings, and a downgrade could occur if the company’s core television broadcasting, pay-TV systems or telecom businesses lead to credit metrics inconsistent with the current rating category. Ratings will also suffer if Televisa’s cash on hand falls below US$1bn.

Use this link to see Moody’s full report.



Proposal to develop national digital agenda presented to authorities

Published: Tuesday, April 12, 2011 15:00 (GMT -0400)

By Business News Americas staff reporters


A proposal for developing a national digital agenda (ADN) in Mexico was presented to officials by a working group made up of ICT industry, legislative and academic representatives, according to a press release from local IT association Canieti.

Representatives were on hand to present the proposal from Canieti and two other local ICT associations – Amiti and Amipci – as well as senate science and technology committee president Francisco Castellón and the lower chamber’s special committee on digital access president Rodrigo Pérez-Alonso.

According to Amipci president Mauricio Braverman, the presentation was made to get the executive branch on board to act as coordinator for the strategy at a national level.

The coordinated effort is expected to lead to setting aggressive goals, policies and action with detailed, long-term and supervised programs that generate growth, Braverman said. The idea is to help Mexico to better compete globally through technology.

Additionally, the ADN looks to drive GDP growth in the next 5-10 years. Canieti president Santiago Gutiérrez said the agenda’s actions and policies will need to be integrated with national development plans to meet this goal, which stems fromOECD studies that recognized a relationship between a country’s ICT investment and GDP.

Castellón said the agenda’s various areas include promoting development of individuals and organizations in a digital environment, safeguarding security and rights in the information society, growing telecoms infrastructure and developing the ICT industry and e-government at all levels.

Specific public policy recommendations include a digital literacy program to educate 100% of the population older than six in basic ICT use, as well as building the necessary infrastructure to bring technology to citizens.

The initiative would also seek to create internationally applicable standards, protect cross-border transactions and strengthen mechanisms for prosecuting cybercrime.

In relation to telecoms, the working group highlighted the need to encourage national and foreign investment; to boost broadband and convergent services coverage, especially in rural and marginal areas; and to encourage greater use of public infrastructure to grow national coverage.

The group also emphasized a need to eliminate the country’s special tax on production and services in telecoms to drive activity.



Eyeing new markets, VeriTran’s international sales account for 60% of revenues

Published: Wednesday, April 13, 2011 15:27 (GMT-0400)

By Juan Pedro Tomás / Business News Americas


Argentine mobile banking and payments solutions provider VeriTran will this year focus on developing new markets across Latin America, company commercial director Marcelo Fondacaro told BNamericas.

Outside Argentina, the firm currently operates in Mexico, where it has three clients, including local bank Banorte. VeriTran has also recently signed an agreement with Mexican retail chain Liverpool to develop the firm’s mobile payment system. “Through this system, clients will be able to pay at Liverpool stores using the mobile phone,” he said. The project is slated to be fully operational in two months.

“This year, we are aiming to attract two or three new clients in Mexico,” he added.

The executive said VeriTran is also carrying out a pilot in Uruguay with local bankNuevo Banco Comercial, and “we’re also looking for opportunities in Chile, Peru, Colombia and Brazil. Specifically in Chile, we expect to attract some clients this year.”

Fondacaro added that revenues from operations outside Argentina currently represent some 60% of the total.

In Argentina, VeriTran provides mobile banking services to 19 banks through local ATM chain Red Link.

Among the company’s domestic clients are Banco Nación, Banco Provincia, Banco de Córdoba, Banco de Santa Fe, Banco Ciudad and BNP Paribas.

The company’s flagship product is a mobile banking platform, but VeriTran also develops products to add value over this platform and is working to create more security elements for the platform. “We have recently implemented a soft token solution for Red Link’s m-banking platform, which will provide more security to transfer operations,” Fondacaro added.



Televisa negocia alianza con Iusacell para ofrecer telefonía móvil

Este es el segundo intento de Televisa para participar en el segmento móvil

Televisa informó hoy que está en conversaciones para participar en una asociación en el mercado de telefonía
móvil con el Grupo Iusacell, propiedad del dueño de TV Azteca, Ricardo Salinas Pliego.

”Hasta este momento, un acuerdo entre Televisa y Grupo Iusacell
no se ha concretado. No hay garantía de que se llegue a un acuerdo, ni los
tiempos o las condiciones de tal acuerdo, en caso de llegarse a
concretar”, aclaró Televisa en un comunicado enviado a la Bolsa mexicana.

Este es el segundo intento de Televisa para participar en el mercado de telefonía
móvil después de que en 2010 estableciera una alianza para adquirir el 30% de Nextel de México, con el fin de participar en una red de telefonía móvil tras
ganar una concesión.

No obstante, el proceso de licitación fue abortado
después de que otros operadores, entre estos el Grupo Iusacell, impugnaran
legalmente la licitación ganada por Nextel-Televisa, por lo que ambas empresas dieron por terminada la alianza que hubiera permitido a Televisa ofrecer servicios de cuádruple play.

Actualmente, las cadenas Televisa y TV Azteca mantienen en los tribunales y en los medios de comunicación una cerrada pugna con las empresas de Carlos Slim, Telcel y Telmex, a las que exigen reducir las tarifas de interconexión y busca frenar el ingreso de Slim al mercado de televisión restringida.