Tuesday, November 7, 2017

The State of the Media Industry in Mexico

As the chill sets in for the beginning of Winter 2017 the time couldn’t be better for some warm weather content, and here you go, in the form of a report I penned on the media, tech, and entertainment industries of Mexico that’s being released to coincide with this week’s Los Cabos International Film Festival.

                                                          

Am I there? Nope. (Although I did once interview Sammy Hagar on location at his Cabo Wabo Cantina  so I’m not short on Cabo stories.) But back to the topic at hand.

When we think of media in Mexico we may think of shows like this...

                                                         

Of course there’s a lot more to the Mexican industry, particularly in the wake of mobile technologies shaking up a media landscape once monopolized by single players enjoying as much as 2/3 of both the Pay TV and broadcast TV markets.

Mexico has traditionally been a country with low internet penetration, due largely to the weak infrastructure for fixed broadband. On top of that, broadband internet was, until governmental reform in 2013, only available to those who purchased a package that also included a landline, and the price point was well out of reach for most in the country.

But hope for greater connectivity came, as it has in many emerging markets, with the the widescale arrival of mobile. It offered a workaround to the costlier, often difficult to access fixed communication networks, and as of 2017 Mexico has 110 mobile users, which represents 90% mobile penetration. The popularity of mobile in Mexico is also relevant to the size of the country’s gaming market. It’s the largest in Latin American, valued at about $1.5 billion, and close to half of the revenues come from mobile gaming. Mexico also has one of the world’s highest rates of YouTube consumption, at 4 billion video views per month.

One thing we haven’t yet discussed about the media industry in Mexico is kind of the elephant in the room, so let’s do that now. Piracy. According to some estimates as many as 90% of DVDs sold in Mexico are pirated copies. Massive markets like Mexico City’s Tepito and Guadalajara’s San Juan de Dios have been key distribution points for counterfeit goods. Despite being in full public view officials turned a blind eye for decades, only occasionally bringing out the front-end loader as one way of dealing with the issue, as seen about a minute into this clip.

                                                     

More recently, digital piracy has become a more urgent issue, though the arrival of a variety of ‘all you can eat’ streaming services for TV and movies has decreased the incidence of illegal downloading. Netflix has about 50% of the streaming market in Mexico, with competition coming from other American-owned services such as HBO Go and Amazon Prime as well as local providers Blim (owned by media conglomerate Televisa) and Claro Video, a division of telco America Movil.

For more on the state of the media industry of Mexico in 2017 click here for the full report.