Introduction to BAIT and its Market Presence
Bodega Aurrerá, Internet y Telefonía (BAIT), a subsidiary of Walmart, has been making waves in the Mexican mobile market with its aggressive approach to market share and user volume. BAIT’s bold moves have captured over 300 million dollars’ worth of market share, preventing AT&T, Movistar, Telcel, and other mobile virtual network operators (MVNOs) from benefiting. With over a hundred MVNOs operating in Mexico this year, BAIT aims to secure the second position in the mobile market.
BAIT’s User Claim Dispute with IFT
BAIT disputes the Instituto Federal de Telecomunicaciones (IFT)’s claim that it has 8.4 million active users, asserting instead that it serves 21.5 million consumers. This stance mirrors Movistar’s defiance against Cofetel (the predecessor of IFT) fifteen years ago when the company refused to disconnect cellular lines that did not adopt an early version of Renaut.
Historical Context: Movistar’s Defiance
In the past, Telefónica Movistar defended user rights when Cofetel mandated certain conditions. Competitors Telcel, Iusacell, and Nextel argued that if Movistar complied, it would face user base purging, impacting Telefónica’s stock value. Movistar’s stance then was similar to BAIT’s current position, as it refuses to accept the IFT’s definition of an active line—at least one transaction in 90 days—preferring BAIT’s six-month usage criterion.
Uncertain Future with New Regulatory Bodies
It remains unclear whether BAIT will maintain this position with the Agencia de Transformación Digital y Telecomunicaciones (ATDT) and Comisión Reguladora de Telecomunicaciones (CRT). These bodies replace the IFT, and it’s uncertain if they will relax IFT’s criteria. ATDT has stated that all IFT policies will remain active until their defined expiration date.
Financial Implications for BAIT
BAIT’s financial standing is evident, having generated 2,700 million pesos (approximately 143 million USD) in Q2 2025, marking its best spring performance since Walmart’s telecom vertical began operations in 2020. BAIT’s first-half 2025 revenue stands at 4,985 million pesos (around 265 million USD), a significant increase from the same period in 2024.
Potential Impact of Altán Redes’ Price Hikes
However, BAIT’s success might be jeopardized by unilateral price hikes from Altán Redes, which supplies reference offers to all MVNOs, including BAIT. These hikes could reduce the final service delivery margins for multiple MVNOs by 6 percentage points, affecting BAIT’s profitability as the market leader.
Key Questions and Answers
- What is BAIT’s dispute with the IFT about? BAIT disagrees with the IFT’s claim of having 8.4 million active users, asserting instead that it serves 21.5 million consumers.
- How does BAIT’s stance compare to Movistar’s past actions? Both BAIT and Movistar have defied regulatory bodies (Cofetel and IFT, respectively) by refusing to comply with certain conditions, preferring alternative definitions of active users.
- What are the potential financial implications for BAIT? BAIT’s strong market presence is underpinned by solid financial performance, but unilateral price hikes from Altán Redes could negatively impact its profitability.
