Sunday, February 5, 2012

"Let Mexico's Moguls Battle" aka Blog Numero Un

http://www.economist.com/node/21546028

Carlos Slim, the richest man in the world, controls most of the phone and cell market in Mexico and is trying to break into the television market.  He owns America Movil, Telmex, Telcel which comprise of 80% of Mexico's landlines and 70% of its cells, but he can't get into the television market, and subsequently is barred from offering "triple play" deals.  But these companies are already ripping off their customers, charging them much more than any other country, in addition to refusing to disclose area codes forcing all calls to be charged as long distance. This has gotten the company in trouble with the WTO.  Telcel was recently fined $1 Billion by Mexico's Federal Competition Commission (CFC), but has yet to pay the fine. the CFC has also exercised its power to stop Televisa from acquiring Iusacell to prevent it from joining forces with the other major TV company TV Azteca.

As for the television market, it is currently dominated by Televisa. Mr. Slim is fighting the Televisa monopoly by partnering with Dish, a satelite television service provider and by offering programs online. So far this has been fairly successful, but their main problem is acquiring material -  the popular "telenovelas" are owned by the rival companies, TV Azteca and Televisa.

But here's where the politics come in.  The proposed switch to digital in 2015 would give Mr. Slim and his fibre optics an advantage over the established networks, but, and election is coming up. The television has already used its power: it blurred out the face of a senator speaking against the television monopoly, later claiming it was an error. The government is, of course, backing down to the powers that be.