Carlos Slim, TV rivals criticise Mexico's telecom reform

The telephone empire of billionaire Carlos Slim and Mexico's dominant broadcaster never see eye to eye, but they now have a common enemy: the government's telecommunications reform plan. President Enrique Pena Nieto's administration introduced in the Senate this week legislation to implement the constitutional reform that passed in the Congress last year. The telecommunications overhaul is a major piece of Pena Nieto's structural reform agenda, which includes historic changes in the energy sector, tax collection and education. But Televisa and Slim's America Movil have each found something to complain about, while opposition parties accuse the government of watering down the legislation's goal of opening up the sector to more competition. Televisa has a 70 percent share of the broadcast market, while Slim's Telmex controls 80 percent of the fixed-line phone service and his Telcel company has 70 percent of the mobile phone industry. Deputy Communications Minister Jose Ignacio Peralta defended the government's proposal on Friday. "What has changed in relation to the constitutional reform? Absolutely nothing," he told reporters. "The fundamental goals remain firm." America Movil, Latin America's largest telephone company, published a full-page newspaper advertisement on Friday calling the bill a "confiscatory proposal" because it would require the firm to give away connection service to rivals for free. The reform would in theory help Slim fulfill his long-held desire to break into the television business, but America Movil charged that the legislation would "protect the main economic player in broadcasting." - Threat of legal action - For its part, Televisa issued a statement saying the legislation contains "disproportionate" rules and warned that it could take legal action to block them. The reform created a new market regulator, the Federal Telecommunications Institute (IFT), which already imposed restrictions on American Movil and Televisa for controling more than 50 percent of their sectors. The watchdog ordered the firms to make their infrastructure available to competitors via public offerings and barred them from acquiring exclusive broadcast rights for high-ratings events such as the Olympics and the World Cup. But the opposition says the government's proposal would undermine the institute by placing many of its regulatory powers in the hands of the ministries of the interior, finance and communications. The conservative National Action Party (PAN) and the leftist Democratic Revolution Party (PRD) have called the legislation "inadmissible," saying the centrist government's proposal serves "political purposes." Peralta, however, insisted that "nothing is being removed" from the IFT. Under the proposed rules, the interior ministry will keep the oversight of advertising time allowed on television while the communications ministry will issue opinions on the issuing or removal of concessions. The government and the IFT must have a "coordinated and joint responsibility" in certain areas of regulation, Peralta said. The executive must retain some oversight for national reasons and to fulfill "political objectives" outlined in the Constitution, he added. For example, Peralta said, the government determined that the "anomalies" in the telephone sector can only be resolved with free access to connection services. The official voiced hope that the Senate would pass the legislation in April and then send it to the lower house of Congress. "What we want is dialogue, a debate that finally allows us to enrich this document," he said.