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Monday, May 16, 2011

MEXICO - Carlos Slim’s Telmex May Be Heading Into Pay TV Competition

Carlos Slim’s Telmex May Be Heading Into Pay TV CompetitionBy Kerry A. Dolan
Telmex, the biggest phone company in Mexico – controlled by Carlos Slim Helu, the world’s richest man – may be inching closer to stiffer competition with Mexico’s two biggest broadcast networks. A federal court in Mexico ruled that Telmex must receive an answer from government regulators within 15 days about permission to offer TV service, Bloomberg and Variety are reporting.
If the government does give Telmex the go-ahead, it will be competing with Grupo Televisa (TV), the leading Mexican TV broadcaster run by billionaire Emilio Azcarraga Jean; and TV Azteca, the country’s second largest broadcaster, run by billionaire Ricardo Salinas Pliego. The broadcasters have been trying to inch their way into Telmex’s territory as well by offering Internet access.
In February this year, it looked like Televisa and Telmex were at loggerheads after Slim’s companies – including Telmex and Grupo Carso –dropped their advertising on Televisa, saying that ad rates were too high. In an article earlier this week the Wall Street Journal discussed the personal edge that the Slim vs. Azcarraga battle has taken, with Televisa ads portraying Telmex’s phone and internet services as an overweight man in a suit. (Slim is a portly man.)
The stakes are high. Telmex is still the dominant fixed-line phone carrier in Mexico, two decades after Slim took it private. His Telcel is the country’s largest wireless carrier. The two companies are owned by telecom company America Movil (AMX), the asset that accounts for close to 60% of Slim’s $74 billion net worth.