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[March 07, 2014]
Mexico imposes restrictions on Slim, Televisa
(Associated Press Via Acquire Media NewsEdge) MEXICO CITY (AP) — Mexican regulators declared the country's main television network and Carlos Slim's telecom company as "preponderant" market players on Friday, part of an effort by the government to promote competitiveness in the telecommunications sector.
By declaring the Televisa network and America Movil "preponderant" authorities can impose restrictions on the companies to allow others to enter the sector dominated by a handful of telecom providers.
Regulators also approved plans to open bidding for two new nationwide TV channels, to foment more competition in an industry where the Televisa network holds about 70 percent of non-cable viewership. Televisa bills itself as the largest media outlet in the Spanish-speaking world.
The federal Telecommunications Institute said Thursday it is working on the bidding guidelines for the new networks. Currently, Televisa's only broadcast TV competitors are several government educational channels and the smaller TV Azteca, a former government network privatized in the 1990s. By midday, Televisa shares were down about 3.4 percent on the news.
Paradoxically for a move aimed at ending market concentration, the decision could open the way for Slim to get into television. Slim's America Movil company controls about a 70 percent market share in cellular telephones and 80 percent of land lines.
In a press statement Friday, Televisa said the regulators' decision requires it to "make its broadcasting infrastructure available to third parties on a non-discriminatory and non-exclusive basis." Regulators said Televisa will be barred from buying exclusive rights to broadcast "programs with unique characteristics that in the past have delivered large audiences on a national or regional basis, such as professional soccer league playoffs, Mexican National team matches, FIFA World Cup finals and Olympic Games," according to the Televisa statement.
However, Slim's Grupo Carso said in a statement to the Mexican stock exchange that authorities have informed them that America Movil will have to share its infrastructure and stop charging roaming for national calls. It also banned it from having exclusive rights for the transmission of Mexican league soccer games.
Rogelio Bustamante, a telecommunication expert at the Technological University of Monterrey, said "there is going to be a change in telecom contents and services in Mexico" as a result of the new rules. "We are entering a new phase of more competition." Televisa said it was still studying the regulatory decision, which was more than 600-pages long.
The company will have to publish its advertising rates, which have been confidential and highly variable.
Agustin Ramirez, president of the nonprofit Mexican Association for the Right to Information, called the new rules "an important step in regulating highly concentrated markets." "The other beneficiary here will obviously be advertising markets .... those markets will explode" because of new, transparent policies in selling ad time.
Televisa has been slammed by critics for churning out a decades-long stream of often smarmy soap operas that are nonetheless popular across the world.
That is not likely to change for the moment.
"Simply issuing bidding rules for new television channels, to create more competitors, will not automatically mean better content for audiences," said Ramirez. But he noted that, apart from Slim, there are other potential operators interested in getting into television, which since its birth in the 1950s in Mexico, has been dominated by Televisa.
"The regulatory authorities themselves say there are at least nine or 10 firms interested in participating in the bidding, and I believe there are," Ramirez said. "Print media (like newspapers) have been getting involved in distributing audio-visual content by internet." While the TV networks have frequently challenged such regulatory decision in court in the past, their ability to do successfully has been limited under a telecom reform law passed in 2013.
Associated Press Writer E. Eduardo Castillo contributed to this report.
Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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