March 12, 2013 – The monopolies that two of the richest men in Mexico hold have come under fire recently with a new set of wide ranging laws whose goal is to open the television and telecommunications industry to competition.
The president of Mexico introduced plans on Monday that are aimed principally at telephone giant Carlos Slim and Grupo Televisa the leading broadcaster in Mexico
The president of Mexico introduced plans on Monday that are aimed principally at telephone giant Carlos Slim and Grupo Televisa the leading broadcaster in Mexico. Both America Movil, Slim’s company and Televisa control 70% of the market in their respective industry.
The new proposal will create a new regulator in telecommunications that could order the sale of assets by those companies that are dominating the market, as well as limit those same companies’ ability to halt competition through years of litigation.
However, it could prove to be difficult for Mexico to create a new competitive business environment from scratch because the entrenched companies are tied strong to consumers.
Televisa is already producing a hoard of the most popular Mexican programming seen on television from daytime soaps to news programs, making it very hard for new companies to grab the attention of viewers. On top of that, any new entrant into the telecom industry would need billions of dollars to invest, just to start.
In his speech on Monday, President Enrique Pena Nieto said that competition fosters innovation and investment that helps bring about social and economic dynamism. He compared the opening of the telecom industry in the country to building new roads and battling illiteracy.
Carlos Slim, listed as the richest man in the world, has held a long hard grip on the phone bills of consumers in Mexico. His company America Movil has over 70% of the nearly 100 million subscribers of mobile phones in Mexico. Telmex, his landline phone business controls over 70% of all fixed lines.