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Mexican mobile operator claims that via asymmetric regulation it is ‘subsidising’ rivals with a bigger global presence.
America Movil on Tuesday reported declining earnings in the fourth quarter of last year and in 2015 as a whole, and once again expressed its irritation with the competitive landscape in its home market, where it is subject to harsher regulation than its rivals.
The Mexico-based operator posted earnings before interest, tax, depreciation and amortisation (EBITDA) of 63.9 billion pesos (€3 billion) in Q4, down 5.1% on the year-ago quarter or 2.9% at constant exchange rates. Full-year EBITDA slid by 5.4% to MXN267 billion.
In Mexico, earnings were down by 9.7% in the full year to MXN110 billion, weighed by a 14.2% decline in Q4 to MXN26.6 billion.
"The decline in EBITDA reflects in part the impact of the depreciation of the U.S. dollar," America Movil said, in a statement.
However, competition clearly also played its part.
Since the arrival of AT&T early last year, competition in Mexico’s mobile market has intensified, the telco said. In addition to the U.S. giant, America Movil also competes with Telefonica and the market is also home to a number of MVNOs.
"At a global level, America Movil is smaller than these competitors in terms of revenues, profits and enterprise value," the operator said.
Indeed, according to Total Telecom’s 2015 Global 100 report, AT&T is the world’s biggest telco by revenues, while Telefonica comes in eighth, one place above America Movil.
"Still, these two large enterprises are subsidised by America Movil with asymmetric regulation," the operator complained. "We have now very intense competition in Mexico that benefits our consumers."
The operator’s comments come as Mexican telecoms regulator the IFT prepares to review the anti-dominance regulations that have hit America Movil over the past couple of years.
America Movil’s domestic revenues fell by 1% last year to MXN275.3 billion (€13 billion), impacted by a 6.5% drop in service revenues; mobile service revenues fell by 6.6% to MXN133.2 billion.
Mobile subscribers in Mexico stood at 73.7 million at the end of last year, up by 3.1% on the previous year, but ARPU was down 6.3% to MXN159.
At group level, America Movil posted revenues of MXN894.2 billion last year, up 1.2%.
It ended the year with 285.5 million mobile customers, slightly lower than at end-2014, while fixed revenue-generating units increased by 3.1% to 80.8 million.
