MEXICO CITY (Reuters) – Mexico's Maxcom Telecomunicaciones is set to launch an online video and live television rental service using a technology that allows streaming with a very low broadband speed.
Maxcom already offers phone and internet services in Mexico, where it has around 100,000 broadband users, and its new offering will pit it against U.S. firm Netflix.
Vice President of marketing Gabriel Cejudo told Reuters on Friday that the new service, Yuzu, to be launched next week, will offer a monthly subscription price of 149 pesos ($11) while the service reaches its first 10,000 users.
Yuzu's offer is slightly above the $8 proposal from Netflix, which opened shop in Mexico last week, but unlike the U.S. online video rental giant, the Mexican company will add live television streaming to its mix.
"If you run on at least half a MB (megabit), our platform will work just fine," Cejudo said, adding that the technology used by Yuzu allows the streaming to automatically adjust to fluctuating broadband speed -- common in Mexico depending on traffic -- to always guarantee a steady image.
Mexican users have an average internet connection speed of 2 MB, though much faster and pricier speeds of up to 50 MB or 100 MB are available with a handful of providers, mostly in large cities.
Yuzu, which expects to reach half a million subscribers within its first year of operation, will offer an initial movie catalog of some 500 titles but by early 2012 it expects to grow it to 3,000 titles.
Additionally, it will offer 20 channels like HBO, Fox and Turner, for live television streaming on anything from laptops to smartphones.
Cejudo said Yuzu will focus on the Mexican market for now.
However, it could consider striking deals with companies like Apple to also sell tablet computers to customers, a model that has proved quite successful for companies like tycoon Carlos Slim's Telefonos de Mexico.
"We are in talks with several providers," Cejudo said, without elaborating.
Other companies offering a more limited but free access to online series and movies in the region include Argentina's Cuevana. Slim has flirted with paid online access in Colombia via Telmex TV Online service.
(Reporting by Cyntia Barrera Diaz; Editing by Tim Dobbyn)
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