Mexican media group Televisa, Spain’s Telefonica and Mexican cable television company Megacable plan to jointly bid for fiber optic cable capacity to be auctioned off by Mexico’s government.
The three companies would hold equal stakes in the joint venture bidding for two fiber optic strands being tendered by Mexico’s state power monopoly.
The auction is designed to improve competition in Mexico’s fixed-line telecommunications sector, which is dominated by Telmex, run by tycoon Carlos Slim. Although Telmex is now a private company it stills remains as a quasi-monopoly, says WikiPedia. In 2000, Telmex spun off their mobile unit, creating América Móvil, the fourth largest mobile network operator in the world.
Telmex owns nearly all Mexico’s telephone cables and even the copper wire leading into homes, giving it a powerful hand against smaller companies offering phone or Internet services, but which need access to infrastructure.
“This new fiber optic network will represent for Televisa, Telefonica and Megacable, and also for third parties, an alternative to access data transportation services, increasing competition in the Mexican telecommunications market,” Megacable said in a separate statement.
On Thursday, Mexico’s government said it was taking steps to fine Telmex, which has a market share of about 80 percent in Mexico’s fixed-line market, for impeding smaller competitors from connecting to its network.
Televisa, Mexico’s top broadcaster, has been expanding into telecommunications, and announced in February that it had agreed to pay $1.44 billion for a 30 percent stake in mobile phone operator Nextel Mexico, a unit of NII Holdings.
