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Mexico not yet ready for 3rd national net

NBC Telemundo won't be allowed to operate in country

MEXICO CITY — Mexico’s new administration on Friday dashed the hopes of NBC Telemundo that the government would license a third national network any time soon.

Mexico’s newly appointed communications and transport minister, Luis Tellez, said the administration was committed only to examining the possibility of new TV and radio stations in certain cities — not a third national network.

They were the first public comments on the issue by the new administration since President Felipe Calderon took office on Dec. 1. NBC Telemundo has aggressively been seeking to enter the Mexican market since 2005. Recent squabbles between the No. 2 U.S. Hispanic broadcaster and Mexican webs have sparked local debate on competition in Mexico’s TV market.

Tellez suggested that allowing Telemundo a major stake in Mexico was conditioned on the U.S. government relaxing foreign ownership restrictions Stateside.

“I think the right policy to have is a mirror policy that reflects what happens in the rest of the world,” Tellez said. “If the United States or other countries would open up their television or radio markets so that Mexican companies can participate, then we could reach an agreement that allows their companies to participate in our country.”

Mexico’s broadcast TV market is split roughly 70/30 between media conglom Televisa, which operates four national channels, and its smaller rival TV Azteca, which runs two.

Mexico’s antitrust commission recently issued a ruling demanding the government increase competition in the television market.

Opening up Mexico’s TV market — formerly a political no-fly zone — has become a hot-button issue since the beginning of 2006, after lawmakers approved new TV regulations that were seen as further entrenching Televisa and TV Azteca.

The battle between Telemundo and Mexican webs has heated up in recent months, including legal skirmishes between Telemundo and TV Azteca and ruthless PR campaigns on both sides.

Both Mexican nets have been using their news shows to smear the powerful Saba family, Telemundo’s Mexican partner. Webs recently ran two weeks of tear-wrenching reports on the high prices of drugs that accused major pharmaceutical distributor Grupo Casa Saba of price-gouging. Telemundo and Saba-owned Grupo Xtra formed Palmas 26 earlier this year to seek a national broadcast license.

NBC filed a complaint before the FCC in late November that seeks to bar the license renewal of TV Azteca’s L.A. affiliate. The complaint charges the Mexican web with corruption and argues it lacks the character to operate a broadcast channel.