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Regulators Plan to Introduce Competition into Mexican Telecom Market


27/07/2006

Federal regulators in Mexico have announced plans to allow cable providers into the country`s telecom market, which up until now has been virtually monopolized by Telmex.

An official with the Mexican Communications and Transportation Secretariat said earlier this week that the agency is currently working on a new set of regulations that would let the country`s 200 cable operators in on the $12-billion market, possibly as early as this December.

Allowing cable companies to offer triple-play packages of television, broadband, and digital phone service is expected to add a lot more competition to Mexico`s telecommunications industry.

“We could see prices drop by 30% or more,” commented Alejandro Puente Cordoba, who is president of Canitec, a national cable industry association.

There is no guarantee, however, that this significant regulatory shift will be allowed to occur unheeded. Telmex is known for its annoying habit of throwing lawsuits at any challenge to its dominance.

“I think they’ll take some legal action to slow it down,” predicted commented Gartner telecommunications analyst, Juan Ignacio Fernandez. “If the tools are available for them to delay opening a market or implementing market changes, they will use them.”

Nevertheless, Mexico`s huge throng of cable companies are becoming increasingly hungry for their share of the market, while there is growing demand among consumers for more options. It is probably only a matter of time before Telmex will be forced to give up its government-sponsored monopoly, and begin competing fairly in the fast-paced and demanding world of telecom.



 

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