Mexico’s government has put forward a proposal to increase competition in the country’s telecoms market, a move that would hit Carlos Slim’s America Movil the hardest.
A new bill calls for the creation of a new telecoms regulator that would have the power to make fines, introduce price controls and even enforce asset sales on dominant players, as well as restrict the appeal process that currently blocks regulatory decisions.
The new regulator, to be called the Federal Telecommunications Institute, would oversee both mobile and fixed telecoms markets, as well as the country’s television services. It would replace the existing regulator called Cofetel
America Movil has 70.37 million subscribers in Mexico (Q4, 2012 figures), according to Wireless Intelligence, equivalent to a market share of 69.6 per cent.
The country’s government is led by President Enrique Pena Nieto who has backed the proposals as a means to galvanise the country’s economy. He is keen to see more competition to the country’s dominant broadcaster, Grupo Televisa, as well as America Movil.
Under the proposals, special courts would have the power to handle regulatory disputes in the telecoms market, prohibiting the likes of America Movil from blocking decisions by using the appeal process.
The bill would also remove restrictions on foreign ownership in fixed services. In addition, the government plans to create its own wholesale telecoms network to encourage internet access to spread more evenly across Mexico. It wants to see internet access spread to 70 per cent of homes and 85 per cent of businesses.