América Móvil hit with record $1B fine in Mexico
Mexico’s Federal Competition Commission has slapped América Móvil with a $1 billion fine for monopolistic practices following a probe launched in that country in 2006. The watchdog agency determined the company, which commands 71 percent of Mexico’s mobile market through its Telcel subsidiary, is abusing its dominant position.
“América Móvil and Telcel are currently analyzing the scope and legal grounds of said resolution in order to exercise any and all applicable legal remedies,” the company said in a statement posted on its website soon after the Mexican regulator’s decision became public.
América Móvil, owned by tycoon Carlos Slim, had 225 million mobile subscribers at the end of last year, including 64 million in Mexico, where the scenario with its competitors is rather messy. Telcel and its fixed-line sister company Telmex, and a group of competitors including Televisa and TV Azteca have filed a flurry of complaints trading monopolistic practice accusations against each other.
Earlier this month, Televisa announced its intention to buy a 50 percent stake in Telcel competitor Iusacell for $1.6 billion, to enter the wireless market itself and seemingly put pressure on América Móvil’s industry chokehold.
América Móvil has a similar market advantage in Puerto Rico as the owner of Claro, the incumbent carrier and competitor in multiple telecom segments: landline and wireless telephony, Internet and paid television services. Claro, which controls the island’s largest telecom network, must also allow competitors to interconnect and be able to offer their services.