Introduction to Megacable Holdings and the IFT
Megacable Holdings, a prominent telecommunications and broadcasting company in Mexico, has become the first entity in its sector to be affected by an effective regulatory policy from the Instituto Federal de Telecomunicaciones (IFT) regarding market substantial power.
IFT’s Decision and Timeline
The IFT approved a cost model and reference offer for Megacable Holdings following its declaration as an economic agent with substantial market power. This decision will take effect from June, sixty days after the resolution on March 26. The implementation of this regulation is independent of any potential legal dispute initiated by Megacable against the IFT’s resolution on March 20, 2024.
IFT’s Market Influence Determination
On March 20, 2024, the IFT officially determined that Megacable Holdings, a provider of fixed internet, video, and voice services, has the capacity to influence the fixed telecommunications market in its favor across nine cities in five Mexican states. As a result, the company was subjected to a special policy requiring the sharing of its infrastructure with third parties requesting access.
Cities and Companies Affected
Third-party companies can now access Megacable’s infrastructure to offer bundled double and triple-play services in Zinacantepec and San Mateo Atenco, State of Mexico; León and Guadalajara, Jalisco; Cuautlancingo and San Pedro Cholula, Puebla; and Corregidora and El Marqués, Querétaro.
Megacable’s Stance
Megacable Holdings maintains that it does not engage in anti-competitive practices and aims to serve the market. The company asserts that it cannot influence the fixed telecommunications market adversely and expects to win its legal challenge against the IFT.
IFT’s Regulatory Action
The IFT imposed this regulation on Megacable Holdings due to the ongoing legal appeal by the company, with no definitive court ruling yet. Previously, only Grupo Televisa had been declared an economic agent with substantial market power twice. However, Televisa successfully contested the IFT’s decision in the courts.
Key Questions and Answers
- What is the IFT’s decision regarding Megacable Holdings? The IFT approved a cost model and reference offer for Megacable Holdings, subjecting it to a regulatory policy requiring the sharing of its infrastructure with third parties.
- When does this regulation take effect? The regulation will be effective from June, sixty days after the resolution on March 26.
- Which cities and companies are affected by this regulation? Nine cities in five Mexican states are impacted, including Zinacantepec and San Mateo Atenco (State of Mexico), León and Guadalajara (Jalisco), Cuautlancingo and San Pedro Cholula (Puebla), and Corregidora and El Marqués (Querétaro). Third-party companies in these locations can now access Megacable’s infrastructure.
- What is Megacable Holdings’ stance on the regulation? Megacable maintains it does not engage in anti-competitive practices and expects to win its legal challenge against the IFT.
- Why was this regulation imposed on Megacable Holdings? The IFT imposed the regulation due to Megacable’s substantial market power, with the company currently appealing the decision in court.
