The U.S. Commercial Service’s Mexico offices released the following new reports on Mexico in June and July, 2009. Copies are available at the links below:
Carlos Slim Helu plans to invest nearly US$4 billion next year to grow Telmex (NYSE: TMX), his Mexican fixed-line telephony business, and America Movil (NASDAQ: AMOV), his Latin American mobile phone business, according to a Reuters report.
He will invest approximately US$950 million in Telmex, with possible additional investment if the Mexican government authorizes Telmex to operate so-called triple play services — cable, Internet, and phone services using a single broadband connection. (How is that for a carrot to Mexican government officials charged with granting Slim triple-play authority?)
He will invest approximately US$3 billion in America Movil to expand its cell phone network in Latin America.
Mexico Law Blog’s newsletter will now be issued once per week, not every four posts as previously issued. It is hoped that the new issuance schedule will reduce email congestion for subscribers.
The talk, which perhaps naturally focused on the financial crisis gripping the U.S., was mostly pleasant, although Slim did get testy when pressed about his personal wealth and monopolistic practices. Here are some highlights:
—Slim urged more flexibility and creativity in dealing with homeowners facing foreclosure, suggesting temporary, interest-only loans as an alternative to seizing a home. “There need to be solutions…that aren’t total punishment,” he said.
—There was much curiosity about Slim’s recent purchase of 6.4 percent of the New York Times’ stock. Many of the ink-stained wretches wondered what Slim saw in newspapers at a time when the industry is suffering through its own crisis. Slim, much to our relief, argued that there will always be a need for quality content regardless of the packaging. “It’s an evolution,” he said of the newspaper business. “The ones that don’t evolve will disappear.”
—Slim took umbrage to any suggestion that his companies were bad for Mexico, lashing out at one reporter: “To think that in poor countries there shouldn’t be strong companies is perverse,” he said. “Why should foreign companies (be the only ones that prosper)…The ideal would be that there were more companies like this.”
—He also turned the tables when asked about monopolistic practices, complaining that Mexican regulators won’t let him run video over phone lines as part of a so-called Triple Play of cable, telephone and Internet service. On the other hand, cable and other phone companies have accused Telmex of charging outrageously high connection costs to hook up to its monolithic network, forcing many would-be fixed line providers out of the market.
Live Nation, Inc. (NYSE: LYV) announced yesterday that it has entered into a five-year exclusive distribution agreement with Corporación Interamericana de Entretenimiento, S.A.B. de C.V. (CIE) (BMV: CIE), and T4F (Time For Fun), extending Live Nation’s global distribution platform into Brazil, Mexico, and other countries in Latin America. Live Nation’s press release said:
CIE is the third largest concert promoter in the world, according to Billboard magazine. Producing live concerts that drew over 6 million music fans in 2007, CIE generated more than $1 billion in revenue and margins approaching 21 percent. CIE, which is publicly traded on the
Mexican stock exchange, operates top venues and regularly promotes major concerts and operates their own ticketing platform in many important music markets including Mexico City (population 20 million), Guadalajara (population 4 million), Monterrey (population 3.8 million)
and many others. CIE produces more than 85% of all the live concerts by international talent in Mexico, a country with a population of more than 100 million people.
T4F operates top venues in Sao Paolo (population 18.3 million), Buenos Aires (population 12.6 million), Lima (population 7.1 million), Rio de Janeiro (population 6 million), Santiago (population 5 million), and Porto Alegre (population 4.1 million) all of which are emerging as important new markets for international talent.
“This expansion provides us with a world class execution partner and a new revenue source to further monetize our global tours in a region where we currently have no market share,” said Michael Rapino, President and Chief Executive Officer of Live Nation. “Alejandro and Fernando have built a remarkable live music infrastructure in Latin America which will immediately allow us to expand our global distribution pipe into more than 25 new outlets and give us access to growing music markets with a total population of more than half a billion people.”
Alejandro Soberón Kuri, Chairman and Chief Executive Officer of CIE commented: “It is very clear to us that Live Nation’s global platform is attracting the world’s most exciting and successful artists, cementing their position as the leading provider of talent on a global basis. By forming an exclusive alliance with Live Nation, we are ensuring that our distribution channels will be filled with a steady stream of live concerts from the greatest artists in the world.”
Fernando Alterio, President of T4F spoke to the alliance: “Access to Live Nation’s unparalleled global touring division will help solidify our position as the market leader in South American live entertainment.”
According to Yahoo! Finance, “Live Nation, Inc. operates as a live music company. It principally promotes live music events in its owned and/or operated venues, and in rented third-party venues, as well as produces music festivals. The company also engages in the production and/or promotion of music tours, and provision of various services to artists. In addition, it manages its in-house ticketing operations, and online and wireless distribution activities, including the development of its Web site; and rents its venues for events. Further, the company involves in the presentation and production of touring and other theatrical performances, ownership and/or operation of theatrical venues, and sale of sponsorships and advertising.”