![Fuente: Reuters](/sites/default/files/styles/1280x720/public/2024-03/amazon_video.jpg_879771447.jpg?itok=SWCiF-SE)
This is stated by Fernando Borjón, former commissioner of the Federal Telecommunications Institute of Mexico, after the measure taken by the economic competition regulator.
The Federal Economic Competition Commission of Mexico (Cofece) proposes a separation of streaming services from Amazon and Mercado Libre's e-commerce loyalty programs.
The authority is not ordering a suppression of these services in the offers of these companies, but rather that Amazon and Mercado Libre independently market their streaming products from any other related to electronic commerce, in order to promote greater balance in that sector. which during 2023 generated a business of 658,300 million pesos (US$ 38,552 million), according to the Mexican Association of Online Sales (AMVO).
Cofece estimates that the existence of various services associated with the e-commerce loyalty programs of Mercado Libre and Amazon, among which are streaming products, create barriers to competition, making e-commerce in Mexico a business of practically two companies.
Amazon and Mercado Libre, by having services such as streaming with very affordable prices that add value to the memberships of their e-commerce platforms, influence the behavior of Mexican consumers in their favor, for example, also with discounts on the prices of products and time agility in shipments.
These tactics end up being anti-competitive, because they affect the rest of the e-commerce offering platforms.
The authority considers that this imposes artificial barriers to the entry of new players in electronic commerce, which Cofece identifies as the Relevant Seller Market, increasing costs for these other companies.
For this reason, Cofece has ordered the separation of the streaming divisions of Amazon and Mercado Libre. In this way, the Prime Video business that offers audiovisual content and shipping the day after purchase for 999 pesos per year (US$ 58.5), must leave the Amazon Marketplace offer.
The same should happen with Meli+, the Mercado Libre streaming platform platform that offers Deezer Premium, Disney+ and Star+, plus a 30% discount on the contracting of ViX Premium, HBO Max or Paramount+, for 149 pesos per month.
These streaming services, also called OTTs, are considered telecommunications services and their regulation is the power of the Federal Telecommunications Institute (IFT), so Cofece would be reissuing with this determination the 2019 conflict that confronted both regulators over the Uber case. -Cornershop.
Fernando Borjón, chief consultant at Access Partnership, also believes that ordering the separation of streaming services from Amazon and Mercado Libre Marketplace memberships because it is common in the business strategies of both companies, is the result of an investigation without much support.
Borjón, who a decade ago worked as commissioner of the IFT, explains that, at least as far as Mercado Libre is concerned, that company would have had little time to impose barriers to competition through Meli+, since that platform offered the services of streaming less than a year ago and Mercado Libre, he indicated, thus tried to replicate Amazon's success with Prime.
“The streaming market has had quite a big growth, but not everyone has been successful, nor has everyone entered the market with the same strategy. Cade is looking for a piece of the pie, which has been growing, but they, Amazon and Mercado Libre, have not been associating streaming with e-commerce. If that were the case, Netflix would be the incumbent agent because it is the leader,” he said.
In Mexico, the streaming market reached a business of US$ 2,084 million by 2022, the latest data confirmed by the IFT.
In terms of income, the largest attractor is Netflix, with 59% of the money inflows for 2022 and Amazon Prime did not feature in the IFT percentages.
With only 7.1% of subscribers at that time, some 882,000 accesses, while Netflix closed that year with 32% of all subscriptions in Mexico. Mercado Libre and Meli+ only appeared well into 2023.
“It is not understood how Cofece maintains that the common point of Amazon and Mercado Libre is streaming and that is why it must be removed from the offer, in addition to the fact that its resolution intersects with the powers of the IFT, which for its part would make its own research or do joint research.
The issue here is how a company, with 7% of streaming and another that has just been born and has no customers yet, can impose barriers to competition and can be dominant in the e-commerce business without streaming being a e-commerce platform.
That is not supported and it does affect competition. Cofece would have to investigate other facts to say that Amazon and Mercado Libre are dominant,” said Fernando Borjón.