Bloomberg News

America Movil’s Unconventional TV Numbers Make Ranking Difficult

June 14, 2013

America Movil’s Unconventional TV Numbers Make Ranking Difficult

Mexican billionaire Carlos Slim, chariman emeritus of America Movil Sab de CV, speaks at a news conference in Mexico City, Mexico, on Jan. 31, 2012. Photographer: Susana Gonzalez/Bloomberg

Who’s the biggest pay-TV company in Latin America? It’s a mystery.

You’d think it’d be an easy thing to calculate. America Movil, the mobile-phone company owned by billionaire Carlos Slim, reported 16.4 million pay-TV subscribers at the end of 2012. DirecTV, which has been expanding its satellite business beyond the U.S., tallied up the second-most, with 10.3 million. (DirecTV also has a minority stake in Sky Mexico, which had 5.2 million.)

So America Movil’s the champ, right? Not so fast. It turns out that the Mexico City-based company uses an unconventional method to count its TV subscribers, making comparisons impossible. According to data Bloomberg compiled, the method allows America Movil to count at least 4 million units it wouldn’t have otherwise.

Latin America is a big hotspot for the pay-TV business, where an emerging middle class is signing up for satellite and cable services for the first time. That’s why bragging rights are important.

America Movil says its TV numbers are made up of RGUs -- revenue-generating units. “RGUs are a non-standardized measurement that includes other types of digital services,” the company said in an e-mailed statement. It didn’t elaborate on what other services were included.

Most companies just count up the number of households who subscribe to their services. America Movil is required to use that conventional method when it reports its subscriber figures to regulators in Brazil, its biggest market for TV service. That reveals the large difference between the two approaches.

The company’s units, Embratel and Net Servicos, told the Anatel government agency they had a total of 8.5 million pay-TV subscriptions at the end of last year. In its annual report, America Movil told investors it had 12.6 million Brazilian pay-TV subscribers. The annual report used the words “subscriber” and “RGU” interchangeably.

DirecTV told Anatel its Sky Brasil unit had 5 million subscribers in Brazil, the same figure it gave investors in its 2012 annual report. Brazilian phone carrier Oi reported about 750,000 TV subscribers to the agency.

That’s why declaring a winner is so tough, especially because not all national regulators offer detailed subscriber data. In addition to Brazil, America Movil offers TV service in markets such as Colombia and Peru. (It can’t sell pay-TV in its home market of Mexico because of local restrictions there.)

However the numbers are counted, DirecTV is growing faster. Its Latin American subscriber base was up 31 percent in 2012, compared with a 22 percent increase for America Movil.

America Movil’s idiosyncratic approach doesn’t have any effect on its financial figures and still lets investors see growth trends, said Christopher King, an analyst at Stifel Nicolaus & Co. Still, it’s “odd,” he said.

The Aging of Abercrombie & Fitch
blog comments powered by Disqus