Mexico is overhauling its telecom sector—and challenging the business dominance of its richest man, Carlos Slim. The Senate this weekend approved a bill (paywall) that would strengthen the regulator, help new players, and potentially keep Slim out of the TV market. The lower house of Congress is expected to pass the bill in the next few days.
Slim, who is worth an estimated $74 billion, controls 70% of Mexican mobile subscriptions and 80% of fixed lines (paywall) through his company America Movil and has done so since acquiring the former state-monopoly Telmex in 1990. The new bill means that the regulator has new powers to set phone rates of dominant players—a crucial power after Slim’s conglomerate was declared “dominant” in the sector by the regulator in March. Under the new telecom bill, Slim’s mobile unit, Telcel, will have to allow calls from competing networks without charge.
The bill also could diminish the power of dominant players in television. Grupo Televisa, which controls 70% of the TV market, was also declared dominant in its sphere and will be obliged to share its infrastructure with new entrants. The government is to auction off the rights to two new TV networks in September for the first time ever. Televisa cannot participate.
Slim’s Telmex cannot join the TV industry over the next 18 months until his company complies with all these antitrust actions in the telecom sector—though the WSJ reported that Slim may be allowed to bid via new companies.
While his telecom dominance could slip, Slim’s business empire today extends well beyond that sector. One journalist concluded recently that he couldn’t go a day in Mexico City without paying something to one of Slim’s companies.