The stock of Mexican telecommunications provider Axtel rose for a third straight session on Thursday on news that it plans to offer satellite television, creating tougher competition for media giant Televisa.

The stock rose 4.09 percent to 9.67 pesos, bringing its gain over the past three trading days to about 18 percent.

Axtel said on Tuesday it had received permission to offer direct-to-home satellite television and that it would offer video, phone and Internet packages in early 2010.

So-called triple play bundles of Internet, telephone and Internet are meant to lower delivery costs and shore up customer loyalty and are the Holy Grail of Mexico's telephone and cable television industry.

Axtel is Mexico's No. 2 fixed-line telephone company but is far behind industry leader Telmex, controlled by billionaire Carlos Slim. Telmex commands about 80 percent of the market.

Axtel's planned move into satellite television follows the entry this year of Dish Mexico -- a venture between MVS Comunicaciones and set-top provider EchoStar, which forced Televisa to cut prices for its Sky satellite service. A package offered by Axtel could shave profit margins further.

Keen to bolster competition, President Felipe Calderon is expected soon to ask legislators to amend a law to allow foreign investors to take controlling stakes in the fixed-line telephone industry.

Whenever the foreign ownership regulation does change in Mexico, it could make Axtel a more interesting asset for someone like Telefonica than it was before this license, JP Morgan said in a note to clients this week.

Axtel offers voice and Internet services in 39 cities in Mexico.

So far, Mexico's government has refused to allow Telmex, which has 80 percent of Mexico's fixed-telephone lines, to offer television.

Critics warn that letting former government monopoly Telmex move into the television market too soon would endanger the survival of small cable television and video companies.

Shares of fixed-line operator Axtel also got a boost on Thursday after Santander raised its rating on the stock to buy from hold.

Mexico TV