América Móvil, the Mexican telecoms giant owned by billionaire tycoon Carlos Slim, has reportedly sub-licensed the rights to next year’s winter Olympics in Sochi to state-owned television channel Canal 22.
According to a report by Forbes which cites Mexican daily Reforma, Slim’s company has opted to sell the rights to Canal 22, a channel that typically airs cultural shows, rather than dealing with Televisa and TV Azteca, who between them broadcast to 100 per cent of Mexican households.
Slim’s relationship with the two TV giants, which are owned by his rivals Emilio Azcarraga and Ricardo Salinas Pliego, has been fractured for some time and in 2011 he stopped advertising with the companies after a dispute over phone and advertising rates.
Canal 22 therefore appears to have benefited from the dispute and the new Olympic rights deal is expected to be signed in Mexico City on Wednesday.
While América Móvil has sold the TV rights to Sochi 2014, the company is thought to have retained the mobile and online rights. It is also unclear whether the deal with Canal 22 includes the rights to the Rio 2016 summer Games, which América Móvil also owns.
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América Móvil won the exclusive broadcast rights to both Games for all of Latin America, excluding Brazil, in March. That deal, which covers 17 Latin American territories, was estimated to be worth US$110 million.
Acquiring the rights to the Olympics was considered a key play by Slim to finally gain entry into Mexico’s pay-TV market which is currently dominated by Televisa and TV Azteca. Regulators have long denied Slim, who controls around 80 percent of Mexico's fixed line business and about 70 percent of the mobile sector, from entering the industry.
However, an anti-monopoly telecoms bill approved by the Mexican government earlier this year will see the creation of two new private TV networks in the country and Slim is widely expected to participate in one of the projects.
Given that the Sochi Games are just four months away, it is likely that Slim, the world’s second richest man with a fortune of US$68 billion according to Forbes, was forced to sell the rights to the event because the new channels will not be up and running in time.