Telmex
From Wikipedia, the free encyclopedia
| Teléfonos de México | |
 |
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| Type of Company | Public (NYSE: TMX) |
|---|---|
| Founded | Télefonos de México, 1947 |
| Headquarters | Mexico City, Mexico |
| Key people | Carlos Slim, Chairman/CEO |
| Industry | Telecommunications |
| Products | Telephone, Internet |
| Revenue |  $12.450.536 billion USD (2005) |
| Net income |  $2.532.648 Billion USD (2005) |
| Employees | 75,484 |
| Website | Telmex |
Teléfonos de México (NYSE: TMX), better known as Telmex, is a Mexican telecommunications company that provides telecommunication products and services in Mexico and in many parts of Latin America, such as Argentina, Brazil, Chile, Colombia, and Peru, and in North America to the United States. In addition to traditional fixed-line telephone service, Telmex also offers Internet access.
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[edit] History
Telmex was founded in 1947 when a group of Mexican investors bought Swedish Ericsson's Mexican branch. In 1950 the same investors bought the Mexican branch of the International Telephone and Telegraph Company, thus becoming the only telephone provider in the country. In 1972 the Mexican government bought the company, turning it into a government monopoly. From 1972 to until its privatization in 1990, Telmex invested little in the country's infrastructure. As a result, it was all but impossible to procure a phone line to one's home.
In 1990, president Carlos Salinas de Gortari decided to sell many state owned companies, with a view towards improving infrastructure and services. Telmex was sold to a group of investors formed principally by Carlos Slim, France Télécom, Southwestern Bell Corporation (resulting in "Taco Bell" used jokingly to refer to the purchase). Their tender was the largest. However, controversially, the payment itself took place over the course of the next several years, using money earned by the phone service.
After privatization, Telmex began investing in new, modern infrastructure, creating a nationwide optic fiber network, and offering service in most of the country.
In 1991, the Mexican government sold its remaining stock in Telmex.
[edit] Telmex Cellphone Mobile Unit
In the 1990s mobile telephones were becoming popular among the general population. The early market leader was Iusacell, and Telmex had no presence in the market. This prompted Telmex to form a subsidiary to provide mobile communications. The subsidiary was Radio Móvil Dipsa, and offered service under the brand Telcel. Telcel started out in a distant second place in its mobile market, but in 1995 everything changed, when the Mexican Currency Crisis hit many Mexicans hard. Iusacell decided to stay with rich customers, offering expensive plans, whereas Telcel began to offer the first prepaid mobile phone plans. Although, in effect, just as expensive as the contracts offered by Iusacell, the success of its prepaid plans ultimately provided Telcel the growth needed to become the leader in the mobile market within two years.
In 2000, Telmex spun off their mobile unit, creating América Móvil, which controls Radio Móvil Dipsa and would be free to develop as its own business as an independent entity. It started with 80% of the mobile market. Many people incorrectly continue to believe that América Móvil is part of Telmex. Instead, both are sister companies under parent Carso Global Telecom, which is part of Grupo Carso.
[edit] Internet
In the mid 1990s Telmex started providing internet access as an Internet Service Provider with the brand Uninet. A year later, they changed the brand to Telmex Internet Directo y Personal (Telmex Direct Personal Internet). In 1996, Telmex' owner, Carlos Slim, bought Prodigy Communications and took the brand to Mexico, renaming the service Prodigy Internet de Telmex. Thanks to their national coverage, Telmex rapidly became the leading national ISP. As of 2005, Telmex holds more than 80% of the market as ISP, and is also the leader in broadband access with its brand Prodigy Infinitum (ADSL).
In 2001, Telmex sold the US branch Prodigy Communications to SBC, which was dubbed SBC Prodigy. However, Telmex continues to own and operate Prodigy in Mexico.
In 2004 Telmex claimed that the number of users of Prodigy Internet grew by 190%.
[edit] Long Distance Competition
In the mid 1990s, AT&T and WorldCom (MCI), among others, began operating in Mexico, representing for the first time serious competition to Telmex. However, due to Telmex' incumbent monopoly position and well-developed infrastructure and coverage, none of them were believed to pose much threat to Telmex.
[edit] Expansion
After spinning off América Móvil, Telmex started an expansion plan, which started with the purchase of Guatemala's Telgua. Later, Telmex bought former state owned phone companies in Central America, and began operations in the USA with Telmex USA.
In 2004, Telmex went into a shopping spree for undervalued operators in South America, including the purchase of then bankrupt AT&T Latin America, giving it presence in Colombia, Peru, Chile, Argentina, Brazil, and Uruguay, and increased reach in the United States. In the same year, Telmex bought Brazil's largest and most important long distance operator, Embratel, from MCI, acquired Chile's Chilesat, took control of Argentina's Techtel (operating in Argentina and Uruguay), of which it already owned 60%, by purchasing the remaining 40% from the Techint group, and purchased Argentina's Metrored. In the USA, Telmex bought 13.4% of bankrupt MCI.
At the same time, sister company America Movil pursued a similar strategy by acquiring cellular operators CTI Movil in Argentina and Uruguay, Claro in Brasil and Perú, Porta in Ecuador and Comcel in Colombia.
In 2005, Telmex sold its holdings in MCI to Verizon.
As of January 2006, Telmex continues buying assets in Latin America and in the USA.
As of March 2006, there are soaring rumors of Telmex buying Verizon operations in Puerto Rico, Venezuela and Dominican Republic. The reports says that the operation can include the wireless operation on each market. The total amount of this sell is estimated nearly $300 usd millions.
[edit] Corporate governance
Current members of the board of directors of Telmex are: Antonio Cosío Ariño, Ricardo Martín Bringas, Carlos Slim Domit, Marco Antonio Slim Domit, Carlos Slim Helú, Robert L. Henrichs, Emilio Azcárraga Jean, Laura Diez Barroso de Laviada, Elmer Franco Macías, Fernando Senderos Mestre, Rafael Kalach Mizrahi, Ángel Losada Moreno, Rómulo O´Farril Jr., Jaime Chico Pardo, Richard P. Resnick, Amparo Espinosa Rugarcía, Juan Antonio Pérez Simón, Rayford Wilkins, Jr. [1].
