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Mexican TV license, chances are Slim

By PETER WHITE

Published: 25 January, 2013

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Whether or not Telmex and its chief beneficiary Carlos Slim, should have access to broadcast markets in Mexico is a typical question that besets most economies at some stage. Should telecommunications be separate from broadcasting?

Try explaining that to anyone, exactly why someone who runs the phone company should not be allowed to run a TV service. It's not easy to be clear on just why the two have been so forbidden around the world. That's because the reason is not always the same.

The US has strict rules on just how many consumers can be influenced by a single broadcasting owner, with roughly a third of the population being the limit. The issue there is influence over voting if you own a newspaper or TV station in enough towns.

Another broader question has always been about state owned vehicles, usually the state telecommunications companies, with monopoly control, and them having an unfair advantage, in terms of access to both money and to technology. The can end up skewing the world's broadcasting, as badly as telecoms were once skewed.

Some countries with regimes which are restrictive, or precarious, also feel they need direct control over the apparatus of broadcasting, to quell the masses. They don't want the telcos taking over.

But in Mexico it has been more about the lack of competition in telecoms, and although Carlos Slim, revered as the richest man in the world, has suddenly gained the backing of the Mexican Government to offer broadcasting services, the courts are still raging against him and have just made him resubmit his broadcasting proposal.

The issue here is explained by the OECD. Slim charges too much and takes virtually monopoly positions, using his great wealth to buy out rivals. In one of the poorest countries in the world - Mexico - the dominant broadband and cellular operators, which he owns, have better margins that those in the US.

The OECD sees the vital role telecoms plays in improving productivity and driving growth, but in Mexico, with the lowest GDP per capita in the OECD, high speed broadband costs an arm and a leg.

The OECD is not anxious to repeat that in broadcasting. Meanwhile Slim has had no such problem outside of Mexico and already dominates most of Latin America with full triple plays - but at least in many of these countries, he has significant local rivals.

In order to continue to get Rethink TV you must register at the RethinkResearch twitter feed, be sure you sign up to it @rethinkresearch, this will be the only way we deliver Rethink TV after February.

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