The figures are undeniable, particularly the financial reports. In Mexico’s telecommunications industry, The crown belongs to Megacable.
This company, which provides television, telephone, and internet services, has outpaced all its competitors, with Totalplay being the only one close behind, according to an analysis by The Economist.
Totalplay, Izzi, and Megacable—the latter appears to be the preferred choice among Mexicans for broadband, as it has recorded the most significant growth in services in recent years.
Comparative financial reports of these three companies, as analyzed by The Economist, show Megacable as the clear winner in revenue growth, with a 10.3% increase in the past year. Additionally, its subscriber base has expanded due to the rollout of services in new areas.
In the past twelve months, Totalplay achieved a growth rate of 13%, primarily due to enhancements in both residential and business services.
The scenario is quite different for Izzi, owned by Grupo Televisa. Their income last year decreased by 3.8%.
Competition for the Most Lucrative Business: Broadband
However, these are not the only figures that matter. According to the analysis by The Economist, The most lucrative area for these companies is fixed broadband services.
In this segment alone, Megacable experienced an annual growth of 11.6%, followed by Totalplay with 9.3%. In contrast, Izzi reported cancellations that resulted in a decline of 5.5%.
The rankings remain consistent regarding each company’s investment in infrastructure: Megacable leads with an investment of 2,748 million pesos, followed closely by Totalplay with 2,668 million pesos. Izzi also invested, but it was less than half of Megacable’s total: 1,311 million pesos.
Mexico was the OECD country with the largest increase in the percentage of fixed broadband subscriptions delivered via fiber optics between December 2022 and December 2023. According to Millennium, our country experienced a growth of 215% during that period.
This increase is surprising, as in 2017, Mexico ranked last in service penetration among OECD countries, as reported by Expansion.
The Investment Game: The One Who Invests Also Wins
The investment landscape also allows for some strategies regarding earnings before interest, taxes, depreciation, and amortization. All of this forms what is known as EBITDA margins, according to The Economist.
Once again, Megacable is in the lead with a margin of 45.7% during the second quarter of 2024. Totalplay follows closely with a margin of 44.3% for the same period.
Izzi, which is currently undergoing a fusion process with Sky as part of Televisa’s strategy to salvage the business, recorded an EBITDA margin of 37.5%. Up until September 2023, it remained the leading generator of EBITDA in the telecommunications sector, but that era is now over.
Televisa’s cable television and internet service lost more than 80,000 users in the past three months, according to Expansion, as it seeks to become more profitable prior to its merger with Sky.
Given the strength of its competitors, it remains to be seen whether Izzi can regain lost ground.
The Rise of Megacable in Mexico’s Telecommunications Sector
The numbers don’t lie, or, to be more specific, the financial reports. In Mexico’s telecommunications sector, The crown is for Megacable.
The company, which offers television, telephone, and internet services, has grown like no other of its competitors, followed only by Totalplay according to an analysis of The Economist.
Totalplay, Izzi, or Megacable: the latter seems to be the favorite of Mexicans when it comes to broadband, as it is the telecommunications company that has registered the greatest growth in service in recent years.
Comparative financial reports of these three companies, carried out by The Economist, show that the big winner in revenue growth is Megacable, as its flow in the last year has increased by 10.3%. At the same time, its subscriber base has grown thanks to the expansion of its services in new locations.
In the last twelve months, Totalplay achieved a growth of 13%, thanks to its strength in both residential and business services. On the other hand, Izzi, owned by Grupo Televisa, faced a different scenario as its income last year was reduced by 3.8%.
Competition for the Juiciest Business: Broadband
According to the analysis of The Economist, the most profitable business for these companies is in fixed broadband.
In this service alone, Megacable had an annual growth of 11.6%, followed by Totalplay with 9.3%. Conversely, Izzi accumulated cancellations to report a drop of 5.5%.
The competitive landscape can be further seen in terms of infrastructure investments:
| Company | Infrastructure Investment (Million Pesos) |
|---|---|
| Megacable | 2,748 |
| Totalplay | 2,668 |
| Izzi | 1,311 |
Mexico was the OECD country with the largest increase in the percentage of fixed broadband accesses delivered via fiber optics between December 2022 and December 2023. According to Millennium, our country had a growth of 215% in that period.
This increase is remarkable, especially since in 2017, Mexico was in last place in service penetration among OECD countries, according to a report by Expansion.
The Investment Game: Who Invests Wins
The investment game also affects earnings before interest, taxes, depreciation, and amortization (EBITDA) margins. According to The Economist, Megacable leads with a margin of 45.7% during the second quarter of 2024, with Totalplay closely following at 44.3%.
Izzi, meanwhile, who is currently in a fusion process with Sky, registered an EBITDA of 37.5%. This marks a significant departure from its previous status as the main generator of EBITDA in the telecommunications sector.
Izzi has lost more than 80,000 users in the last three months, as it tries to become more profitable before its fusion with Sky, as reported by Expansion.
Given the strength of its competitors, it remains to be seen whether Izzi can regain lost ground in this competitive landscape.
