Mexican Nets Post Quarterly Losses
Mexico's TV duopoly still maintains a strong grip on the market.
MEXICO CITY -- Mexican broadcasters Televisa and TV Azteca reported fourth-quarter losses on Thursday as the depreciation of the peso against the U.S. dollar contributed to higher financing costs.
Spanish-language media titan Televisa, the nation's top network, said quarterly net profit dipped 17 percent to 2.17 billion pesos ($155 million), compared with about 2.6 billion pesos a year earlier. Azteca, Mexico's No. 2 network, saw an 8 percent drop in net income to 1.28 billion pesos, down from 1.39 billion pesos earned during the same period a year ago.
Televisa and TV Azteca control 95 percent of the broadcast TV market. Despite a recent public survey result showing that 90% of those polled believe Mexico's over-the-air offerings are insufficient, the government announced earlier this year that it will not grant a broadcast license for a third national network. Industry observers point out that it's an election year and political parties do not want to upset the powerful TV networks.
Televisa attempted to crack Mexico's mobile telephone market but its offer to purchase a 50 percent stake in Iusacell for $1.6 billion was blocked by regulators due to competition concerns. Had the deal been approved, it would have united Televisa with a sister company of rival broadcaster TV Azteca. The Federal Competition Commission quashed the proposed merger because it could have led to possible collusion between two dominant media companies.
On the international side, Televisa has made significant moves lately to expand its presence in two key markets outside Mexico: the U.S. and Spain. Earlier this year, Televisa announced it had formed a programming and development partnership with Lionsgate for the U.S. Hispanic market. Together they will create English-language TV content.
The pact comes two years after Lionsgate inked a deal with Televisa to acquire and produce feature films targeting Latino audiences. Televisa also aims to step up production in Spain, where it recently took a 14.5% stake in Imagina, a leading Spanish-language media outfit.