Bloomberg News

Mexico Mobile Dominance Probe Ruling Expected by July

March 01, 2011

Mexico’s antitrust agency said today that a decision on dominance in the market for completing phone calls to mobile networks in the nation’s telecommunications industry should be reached by July.

Rulings on three other cases should be reached by May, said Eduardo Perez Motta, head of the agency known as Cofeco, in statements today in Mexico City. The Federal Telecommunications Commission must also work to establish a reference price to resolve disputes over how much carriers charge each other to connect calls between their networks, he said.

“There has been growing conflict in the industry," Perez Motta said. "Like all crises, this should be an opportunity.”

Telefonos de Mexico SAB, Mexico’s largest fixed-line phone and Internet provider, and America Movil SAB (AMXL), Latin America’s largest wireless carrier, charge rivals too much to connect calls, competitors such as Axtel SAB and Grupo Iusacell SA have said. Both Telmex and America Movil are controlled by Mexican billionaire Carlos Slim.

Telmex and America Movil say their connection fees use realistic models to determine fair prices.

Slim’s companies announced Feb. 23 they would stop running ads on TV Azteca SA, Mexico’s second largest broadcaster after turning down a proposal to link an ad deal to a reduction in the fees Telmex and America Movil charge Iusacell. TV Azteca and Iusacell are both controlled by billionaire Ricardo Salinas Pliego.

Slim’s companies earlier stopped advertising with Grupo Televisa SA (TLEVICPO), Mexico’s largest broadcaster, over a price dispute.

Telefonos de Mexico should receive authorization to offer pay television services after disputes in Mexico’s telecommunications industry are resolved, Perez Motta said today.

To contact the reporters on this story: Crayton Harrison in Mexico City at tharrison5@bloomberg.net; Jonathan Roeder in Mexico City at jroeder@bloomberg.net

To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net


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