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Crunch time in Mexico

Once monopolists get entrenched, it takes significant courage to dislodge them. The monopoly profits have been used to build up considerable political capital. So it is noteworthy when entrenched monopolies get taken, as it appears to be happening in Mexico.

The lack of serious competition in Mexico has kept prices high, has limited investment and has held back the penetration of new technologies. According to the International Telecommunications Union, only 26 percent of Mexican households had access to the Internet in 2012, compared to more than 45 percent in Brazil.

In a 2012 report, the Organization for Economic Co-operation and Development estimated that Mexico’s “dysfunctional” telecommunications sector cost Mexican consumers $25.8 billion a year between 2005 and 2009.

My colleague Ernesto Flores who is in New Delhi to participate in an expert forum is sure to shed more light on this.

NYT report.


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