Telmex`s (NYSE: TMX) Q3 revenue decline show the ongoing effect of consumers` freedom to either ditch their incumbent phone company for a lower-price triple play voice, video and data bundle from a cable operator or opt to go all wireless for their voice service.
Telmex`s total Internet access lines, 2007-2011
The incumbent provider`s revenues declined 3.8 percent to $266 million in the three months to the end of September, while revenue declined 2.9 percent year-over-year to at MXN 27.76 billion (USD 2.1 billion).
Much of the revenue decline was attributed to a 5.5 percent decline in domestic services, including a 6.1 percent decline in revenue per local calling and 8 percent in local traffic volume and the drop in the number of billed lines. Likewise, long-distance service revenue declined 2.7 percent since Q3 2010.
However, one bright spot in Telmex`s portfolio was international long distance (ILD), which rose 8.3 percent year-over-year with a 27.6 percent rise in incoming ILD revenues.
As is the trend with every wireline service provider, Telmex saw its traditional voice line base decline 1.8 percent year-over-year to 12.274 million lines.
Parent company America Movil (NYSE: AMX) is now in the process of purchasing the remaining portion it does not already own in Telmex.
