By MARK STEVENSON, Associated Press
MEXICO CITY (AP) — A technological revolution is pushing Carlos Slim, the world's richest man, into a battle with other powerful interests in Mexico, creating a billionaires' version of a schoolyard spat: name-calling, attack ads, canceled contracts and even a physical shoving match.
To the wonderment of many Mexicans, companies accustomed to crushing competitors are now casting themselves as crusaders against monopoly.
In recent weeks, the corporate titans have run full-page ads accusing each other of lying, cheating and conspiring to overcharge customers, allegations often bolstered by official studies finding that Mexicans pay far more than they should for many services because major businesses lack strong competitors.
The feud reached new heights on Wednesday when anti-monopoly regulators showed up at the offices of a cell phone company, Iusacell SA, to formally deliver notification that its attempt to form an alliance with the nation's biggest television network had been rejected.
The proposal would have created a stronger rival to the telephone and internet companies that are the key base of Slim's estimated $74 billion fortune. And it would have created a business alliance between Mexico's only two national television broadcasters.
Iusacell workers changed the street number on the sign outside the corporate offices in an apparent bid to confuse the notice servers, according to an official of the Federal Competition Commission who was not authorized to be quoted by name.
When employees of the commission, accompanied by scores of plainclothes federal police, tried to serve the notice anyway, security guards tried to prevent them from entering. That led to a shoving and shouting match between throngs of business-suited lawyers, guards and police in one of Mexico's most exclusive neighborhoods.
The spat added to the bad blood between the television magnates and Slim's cell phone and telephone companies which are fighting for the prize known as the "triple play:" a single company supplying cell and fixed-line phones, TV and internet service to consumers. Whoever wins that market holds a key into the homes of 112.7 million Mexican consumers.
It's a battle fought all over the world. But in Mexico, only two or three major players so far are involved.
Mexico's largest TV network, Televisa, decided to invest $1.6 billion in Iusacell SA, which is controlled by the owner of the only other national network, TV Azteca. Regulators rejected the deal, reportedly citing concerns about the effects of a de-facto alliance between the nation's big broadcasters.
But the networks say the commission's ban leaves Slim's cell phone company in control of the cell market, where it already holds a 70 percent market share.
Many economists say all of the companies could be considered monopolies or duopolies, yet all are claiming they want to bring more competition to highly concentrated sectors.
"We have a sort of Gordian knot here," said Ernesto Piedras, an analyst for the Mexico City-based Competitive Intelligence Unit, who said he favors letting the titans slug it out.
"Some people say, there is already a virtual monopoly, and now another monopoly is going to get into the act,' well, I say, let four monopolies get into the action, that's competition," he said.
That appears to be the choice many say regulators are facing: should they let monopolies in one field expand into other fields, and hope the consumer will benefit from the internecine conflict?
Independent businessman and anti-monopoly crusader Ricardo Alessio Robles doesn't think that is the solution. He agrees with the decision to stop the cell phone deal.
"This alliance between Televisa and TV Azteca, even if it would give a little more competition in cell phones, would lead to a matrimony in television that wouldn't encourage confidence," said Alessio Robles, whose small group of investors lost a fight against Mexico's dominant cement producer, Cemex, in 2004.
His group tried to import a shipload of concrete from Russia and undercut Cemex's prices, but port authorities wouldn't allow the ship to dock, stevedores wouldn't unload it, and tax and customs authorities declared the shipment contraband.