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Four of Mexico's largest cable TV companies on Tuesday launched a basic triple-play package aimed at low-income households under a commercial alliance that they say will increase competition in the telecommunications industry.

"It makes a lot of sense to have a national presence with a single brand, YOO, which makes it easier for possible clients to recognize us," said Carlos Alvarez, chief executive of Cablemas SA, at a press conference.

YOO offers unlimited local calls, broadband speeds of up to 1 megabyte per second, and 40 cable channels for 499 pesos ($38) a month.

The four companies - Empresas Cablevision SAB (CABLE.MX), Cablemas SA (CBMAS.MX), TVI and Megacable Holdings SAB (MEGA.MX) - together have just over 1 million Internet users and 518,000 phone subscribers, with coverage including the country's top three urban areas of Mexico City, Guadalajara and Monterrey.

Media conglomerate Grupo Televisa SAB (TV), Mexico's No. 1 television broadcaster and the largest producer of Spanish language television content in the world, holds controlling stakes in Cablevision, Cablemas and TVI.

Jorge Azzario, chief executive of TVI, said the alliance could eventually be expanded to include other cable TV firms, although no deals are currently in the pipeline.

The executives downplayed possible anti-trust implications, saying the venture doesn't prevent alliance members from competing with each other.

"Each company is independent and we are taking advantage of our strengths to find synergies to the benefit of the consumer," Megacable Chief Executive Enrique Yamuni said.

BBVA Bancomer telecoms analyst Andres Coello said in a report that YOO will likely hurt Televisa's revenue from new subscribers given its lower price versus Televisa's other triple-play packages and the risk existing clients will migrate to YOO.

"On the other hand, the marketing venture between Megacable and Televisa strengthens the thesis that Megacable could be a Televisa takeover target. We reiterate our outperform recommendation on Megacable," Coello said.

Asked at the press conference if Televisa has expressed interest in acquiring Megacable, Yamuni said no talks have taken place.

Phone Company Telmex Under Siege

The YOO alliance is seen putting greater pressure on incumbent fixed-line operator Telefonos de Mexico SAB (TMX), which is prohibited from providing pay TV under local regulations.

Telmex, as the company is also known, had 17.5 million lines in service and 5.5 million broadband accounts at the end of March.

Although the former state monopoly added 512,000 new broadband accounts during the first quarter, it also disconnected 75,000 lines due to a weak economy and competition from wireless carriers and cable TV firms.

The company's plan to enter the pay TV market has been delayed as it awaits a final decision from the federal government over whether it has to pay a fee to change its telecommunications concession to offer that service.

Telmex signed an agreement in November to do billing for Dish Mexico, a venture between Mexico's MVS Comunicaciones and EchoStar Corporation (SATS) that is mounting a direct challenge to Televisa's satellite TV unit Sky Mexico. Customers can also sign up for the Dish service at some Telmex stores.

With its local and long-distance services in decline, Telmex is focusing on growing its Internet business as well as selling discounted packages of phone and broadband services.

Telmex sells a basic double-play package including Internet speeds of 512 kilobytes per second, 100 local calls, and 100 minutes of domestic long-distance calls for MXN389 a month.

"We believe that the greater competition could force Telmex to increase the Internet speed in its packages in the short term," Coello wrote.

However, rivals angling for a bigger share of the country's broadband market will eventually have to address the low penetration of computers in Mexico, where only about a fifth of households have a computer.

The sale of laptops and desktop computers in installments of up to 48 months has been a key driver of Telmex's broadband growth, and the company has financed more than 2 million to date.

-By Ken Parks, Dow Jones Newswires, 52-55-5001-5723, ken.parks@dowjones.com