América Móvil Strengthens Its Presence in Latin American Pay-TV Market

Market Position of AMX in Latin America

América Móvil (AMX), headquartered in Mexico City, is the largest telecom operator in Latin America and one of the world's leading wireless

operators. AMX has cultivated its presence in the Pay-TV field over the years, gradually establishing a comprehensive business ecosystem that encompasses various services such as cable TV and satellite TV. Currently, AMX has 21.9 million subscribers, including 14 million TV subscribers. Its major TV services are cable TV and satellite TV, covering multiple countries including Mexico, Brazil, Chile, Peru, Colombia, and five Central American countries. AMX holds a dominant position in the Pay-TV market in Latin America, making it a leading player in the industry.

Pay TV Background

The traditional digital TV market in Latin America has reached its saturation point, with limited room for additional growth. However, there is still a significant number of users who rely on standard definition (SD) set-top boxes (STBs). Therefore, the conversion from SD to high definition (HD) will become a crucial turning point for the traditional digital TV business, especially in countries with relatively low HD penetration, such as Colombia, Chile, and Central America.

The traditional digital TV market is highly competitive, with a narrow range of content offerings. The average revenue per user (ARPU) has been declining year by year, imposing considerable operational cost pressures on operators. Therefore, reducing operational costs is a pressing issue for these operators. Meanwhile, the widespread availability of broadband has fueled the explosive growth of OTT TV services. Compared to traditional TV services, OTT services offer lower fees and more flexible, personalized customizable options. Mainstream content-rich ecosystems such as YouTube, Netflix and Amazon Prime Video have gained widespread popularity in the Americas, posing huge challenges for traditional operators. Consequently, traditional operators must embrace OTT services and invest heavily in developing IP-based services and a hybrid model of DVB+OTT, as this has become the prevailing trend.

Key Marketing Strategies

ZTE has assisted AMX in attracting subscribers seeking SD to HD conversion at minimal costs. Taking into consideration the challenges faced by AMX, ZTE has introduced cost-effective STBs: B710S2-A10, B710C-A14, B710S2-A16, and B866V2. These devices support MPEG-2/MPEG-4/H.264 HD video decoding, live TV, personal video recorder (PVR), advertising, and UI customization, delivering differentiated video experiences to users.

By supporting both cable and satellite TV services, ZTE's differentiated product solutions cater to a wide range of TV scenarios within AMX. This enhances AMX's product offerings, satisfies user needs, and helps to maintain its competitive edge in the market. Additionally, ZTE maintains close collaboration and interaction with various vendors in the industry chain. Through continuous optimization of solutions, ZTE has successfully helped AMX alleviate cost pressures and contributed to the future market expansion of AMX.

Constantly Creating Value for Customers

In November 2018, after nearly two years of joint efforts, AMX selected ZTE to provide STB services for its five subsidiaries within six months. AMX's decision has firmly established its presence in the traditional TV market, while also driving the expansion of its new video services. This strategic move has resulted in increased ARPU and an enhanced user experience, making it highly significant.

In 2020, AMX effectively implemented ZTE's end-to-end video solution, bolstering its presence in the high-end market. AMX also adopted ZTE's AOSP-based STB (B866V2) to better meet its market demands. This STB not only supports HEVC/1.2654K video decoding, live TV, VOD and advertising, but also integrates rich content from Google applications and the Google ecosystem. It offers users an immersive 4K video experience, attracting the attention of a large number of high-end users.

In 2022, as the Android TV (ATV) market gradually matured and became a development trend for STBs, AMX sought to maintain its competitiveness in the market by venturing into the ATV business. However, AMX also aimed to save manpower and capital costs while retaining the existing AOSP STBs, with a desire to enhance the user experience. To address these needs, ZTE introduced Google's brand-new variant build approval (VBA) solution. As the world's first operator to deploy ATV with a unified hardware platform for multiple subsidiaries, AMX succeeded in upgrading existing STBs from AOSP to ATV. This upgrade greatly reduced hardware replacement costs, shortened the certification period, and accelerated time-to-market. In addition, mainstream content providers such as Netflix, YouTube and Amazon Prime Video were also incorporated to greatly enrich the ecosystem and enhance customer stickiness. During the early stage of the AOSP project, ZTE worked closely with Amco, a platform vendor, the Globalhitss technical team, and UEI, a remote control vendor, laying a solid foundation for the rapid development of the ATV project.

Through its reliable products and services, ZTE has established efficient technical partnerships with third-party vendors and maintained in-depth and effective communication with AMX. With the help of ZTE, AMX has become the world's first operator to successfully deploy the VBA solution. The achievements AMX has made include:

• Migrating existing STBs from AOSP to Android TV
• Saving hardware replacement costs
• Addressing difficult issues of management, certification and deployment in ten countries
• Deploying commercial ATV rapidly in its ten subsidiaries for soaring subscriber growth
• Enriching mainstream OTT video content to enhance user experience and increase ARPU.

The Argentine branch of AMX has become a new end office with millions of STB subscribers, setting a good benchmark for other branches. Moving forward, AMX will continue to work with ZTE to expand its footprint in the high-end market and contribute to the development of Pay TV services in the Mexican and Brazilian branches. Additionally, AMX will consistently prioritize customer value and introduce ZTE's cutting-edge 4K STB solutions to expand its video business, create new revenue streams, and strengthen its market position.