America Movil Hit By Supreme Court Ruling


America Movil was dealt a major blow in attempts to annul restrictions aimed at curbing its dominance, with a top court reportedly siding with the country’s regulator in labelling the operator as the preponderant player.

Reuters reported Mexico’s supreme court ruled against America Movil in its fight against the Federal Institute of Telecommunications (IFT) over its classification of the operator’s position in the market.

The designation as a dominant force, which was given to America Movil in 2014, allows the regulator to impose stricter regulation on the company and subsidiaries including Telcel among others.

Reforms in Mexico aimed at breaking the dominance of the America Movil group resulted in international players including US operator AT&T entering the market.

In a statement, the supreme court said IFT’s classification “validly” limits its rights to benefit citizens, and “to reduce the asymmetries’ in the coverage of the networks with respect to the different mobile operators”.

Further curbs

At the end of 2020, IFT stepped-up its campaign against America Movil, pressing the company make changes to boost competition by enhancing consumer choice, wholesale access and cutting costs.

Analyst and Recon Analytics, Roger Entner told Reuters the ruling was significant as all the restrictions on the company remain in place, and it could pave the way for IFT to impose further curbs on the company.

Despite years of reforms and regulatory efforts to trim the incumbent’s market share, its Telcel mobile brand has maintained a healthy lead over competition in the market.

For Q4 2020, GSMA Intelligence figures show the company had 69.9 million mobile connections, ahead of Telefonica Movistar’s 24.9 million and AT&T’s 18.9 million.

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