Telmex Profit Drops

Telmex posted its latest earnings this week and the results were not so great - a 21.5% drop in third quarter profits.  Telmex, owned by Carlos Slim (the world's richest man), is Mexico's largest fixed-line company.  In some parts of Mexico, your choice for a new phone line is either Telmex...or Telmex.  Telmex control's nearly 80% of Mexico's land lines.

So if Telmex is virtually a monopoly, what is going on to cut their profits so drastically? 

The cable companies.

All over Mexico, cable companies have started to offer "triple play" packages which is a bundle that includes TV, internet, and phone service all for one low price.  Cablevision, Megacable, Telecable, Cablecom, are just a few of the companies that are offering these packages.

Let's look at a comparision:

Telmex monthly phone service (the cheapest plan) $346.49 MXN
Cablevision triple play (internet, TV, phone)          $525.00 MXN
Megacable triple play (internet, TV, phone)            $549.00 MXN

In Mexico, price is king, so it won't be long before Telmex comes up with something to compete with the cable companies.

One of Telmex's latest packages (which I love) is a package that allows you unlimited calls throughout Mexico and the United States for $1,099 MXN/month.  If you call the United States often and live in Mexico, I highly recommend this package.  It also includes internet service.

PS- Did anyone else notice the Telmex logos on the Chilean miners rescue jumpsuits?  This guy is everywhere!!!