Industry Welcomes Mexicos New Cable, Satellite Rules

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Mexico City -- Pay TV executives who do business in Mexico
are breathing a sigh of relief over new regulations they say are much less restrictive
than had been anticipated.

Most significantly, the recently announced rules do nothing
to govern how cable operators and programmers split the six minutes of ad time per hour
allotted to pay TV networks. The legislation also lowers the minimum required level of
national programming content and sweeps away red tape that governed sweepstakes and
competitions.

"We are pleased with what's been said. Now we can
get down to business again," said Mary Pittelli, president and chief operating
officer of the Television Association of Programmers (TAP) Latin America.

Industry executives had feared the government would step in
to mandate how cable operators and programmers split the six minutes of advertising time
allotted per hour. That issue had been unregulated.

TAP, however, failed in its lobbying attempt to lift all
time restrictions on pay TV advertising. The government, for example, won't let
programmers expand ad time to 12 minutes per hour, which would put it on par with
broadcast TV.

"We would like to have no minutes [stipulated],"
said Ariel Bentata, a partner at Miami law firm Bentata Hoet & Associates Inc., which
represents TAP. "That's what we asked for."

Still, some said the expanded ad time was not entirely
necessary at this point. "Six minutes per hour is more than enough advertising time
for the industry to sell at the moment," said Enrique Yamuni, president of Megacable
S.A., one of Mexico's leading MSOs. But expansion could be necessary if the pay TV
business continues to grow, he warned.

Industry executives also welcomed the decision to reduce
the minimum level of domestic programming that must be transmitted on cable and satellite
channels. For cable, the level was reduced to 7 percent from 20 percent; direct-to-home
satellite-TV channel requirements were cut to 8 percent from 20 percent. Local cable
systems must offer 1 percent local programming from the area in which they operate.

The new legislation also permits programmers to launch
on-air contests, such as sweepstakes, without receiving government approval.

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