Mexican Moguls Play Monopoly With Telecoms

A tit for tat dispute among billionaires

Three of Mexico’s telecom giants are playing a game of monopoly, but it is unclear if any will be able to pass 'Go.' Luckily for them, they’ve all got way more than $200 in the bank. The world’s richest man, Carlos Slim Helu, and media giants Emilio Azcarraga Jean and Ricardo Salinas Pliego are fighting bitterly for a larger piece of Mexico’s telecom market.

Up for grabs is an industry projected to be worth $35 billion by 2015. Slim, with a worth of $74 billion, already controls 80 percent of land lines, 70 percent of cell phone service, and owns the largest Internet service provider in the country, Prodigy Infinitum. But now, the billionaire wants more. Setting his sights on television, Slim is stepping into the realm of Azcarraga and Salinas and isn’t receiving a warm welcome.

Slim’s business represents a veritable monopoly on the Mexican telecom scene, and the only thing in his way is the government’s 1990 decision to bar him from entering TV and radio when he acquired Telmex, a former state phone monopoly. Now Slim wants in, arguing unfair advantage for Azcarraga and Salinas whose operations have access to the television market.

In response, Azcarraga and Salinas are taking Slim’s anti-competitive policies to task in and out of the courts. Formal complaints to Mexico’s anti-monopoly regulatory agency and teaming up in the wireless market are attempts to even a playing field already dominated by the three top players. These are just a few maneuvers in an ongoing tit for tat among giants.

A recent report by the World Bank chastises the Mexican system, plagued by institutional weakness, for disadvantaging consumers who reportedly pay some of the highest phone rates in the world. For Slim, Azcarraga, and Salinas, their game of monopoly might not end by going directly to jail, but beefed up antitrust regulations and more stinging pecuniary penalties in Mexico might prevent some future prime real estate acquisitions.