Televisa to invest $1.6 billion in Iusacell

TV giant joins forces with Iusacell to fight Carlos Slim’s grip on the cell phone industry

Mexico Weekly / April 7, 2011

Grupo Televisa announced Thursday it will invest $1.6 billion in cell phone operator Grupo Iusacell.

The transaction means Televisa will own half the shares of Iusacell, allowing the television giant to enter the cell phone industry, dominated by Carlos Slim’s Telcel.

Iusacell, Mexico’s third-largest cell phone operator, has announced it will use $1.565 billion to pay off debts and the rest to expand its network.

Iusacell is part of Grupo Salinas, which also owns TV Azteca, Televisa’s main television competitor.

The two TV networks, along with 20 other cable TV operators, recently formed an alliance that has launched an aggressive media campaign against Slim’s telecoms empire.

Through its 51-percent participation in Cablevisión, Televisa has been able to offer triple play services (cable TV, fixed phone and broadband Internet).

Grupo Salinas, on the other hand, launched its Total Play service last year, which also offers triple play services.

“Carlos Slim is an enemy who's too strong for [Grupo Televisa and Grupo Salinas] to face on their own,” El Universal columnist Salvador García Soto wrote on Wednesday.

This is Televisa's second attempt to step into the cell phone industry. Last year, Televisa sought to acquire 30 percent of Nextel de México, but the bidding process was terminated after other operators – among them Iusacell – challenged the deal in courts.

MVS Also Wants A Piece

Also on Thursday, MVS Communications announced it had signed a partnership with Intel, Alestra and Clearwire to build and operate a national 4G Internet network.

MVS president Joaquín Vargas said the next-generation service would be up to 20 times faster and 50 percent cheaper than current broadband offerings.

The consortium does not yet have approval from the Federal Competition Commission, but it does have the support of some commissioners from the Telecommunications Commission, Excélsior reported Thursday.

“Joaquín Vargas has put something on the table that no one else [has]: ultra-high speed mobile Internet that is now possible for Mexico,” business commentator Carlos Mota wrote in his column in Milenio on Thursday.

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