MEXICAN TELCO EYES HISPANICS IN U.S.: TELEMEX-SPRINT ALLIANCE APPEALS LONG-DISTANCE RATE LEVELS TO FCC

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[mexico city] Mexico's government-owned Telefonos de Mexico plans to start testing long-distance phone service to the U.S. Hispanic market in a joint venture with Sprint Corp.

Although Telmex-Sprint has assigned U.S. advertising to its Mexican agency, Alazraki & Asociados, and started testing ads in Tucson, Ariz., Telmex is fighting the Federal Communications Commission on rates in the U.S.

FCC NEGOTIATIONS

The FCC last year awarded a license to provide international telecommunications services within the U.S. to the Mexican carrier, but approval is contingent upon it lowering tariffs to connect calls originating from the U.S. with its own network.

Telmex is negotiating with the regulatory agency as well as responding to charges filed by AT&T Corp. and MCI Communications Corp. They are seeking a greater reduction in international interconnection charges. Telmex already competes against those carriers Mexico, where Telmex's monopoly over phone service ended in January 1997.

Robin Carlson, Sprint's manager of corporate communications, acknowledged both AT&T and MCI have filed letters of complaint with the FCC but insisted that, with the license in hand, Telmex-Sprint has the legal go-ahead.

Telmex-Sprint will target Mexican-Americans and Mexicans living in the U.S., Ms. Carlson said.

The campaign will be launched on a city-by-city basis in Arizona, California, Illinois and Texas.

IN FOUR STATES

"By May or June, we should be in all major markets" in those states, said Alazraki President Carlos Alazraki.

The Spanish-language ads will run in print, TV and radio. The campaign theme is unifying Mexicans on both sides of the border.

"This is a real tear-jerker campaign," Mr. Alazraki said. "The idea is `We know you better.' "

"Depending on the [test-market] results, we will then roll out services," said Ms. Carlson.

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