Paper: Poor implementation may outweigh short-term benefits of Mexico’s telecom reform

A new policy paper from the Mexico Center at Rice University’s Baker Institute for Public Policy examines the impact that the constitutional reform of the country’s “anemic” telecommunications could have on market competition, human rights and public welfare.

Credit: thinkstockphotos.com/Rice University

While the original reform initiative appeared to address key problems at the root of the dysfunctional system, the reform’s legislative implementation has been widely criticized by public policy experts and human rights advocates, according to the policy paper, “The Telecommunications Sector in Mexico: Present and Future in the Context of the 2014 Reform.”

When Mexican President Enrique Peña Nieto enacted constitutional amendments in June 2013 to reform the country’s telecommunications landscape, this development was seen as a watershed moment for reducing the power of telecommunications monopolies, strengthening freedom of speech, improving information accessibility and modernizing telecommunications infrastructure, said the paper’s author, Oscar Bejarano. The viability of these goals, however, has been hampered by the so-called secondary laws, which represent the fine print to last year’s constitutional amendments and were signed into law by Peña Nieto July 14, he said.

Bejarano is a doctoral candidate in Rice’s Department of Electrical and Computer Engineering and 2014 summer graduate intern under the Mexico Center’s director, Tony Payan. Bejarano wrote that beyond issues regarding freedom of speech, the controversy around this reform exposed other equally unacceptable realities of the new telecom sector in Mexico.

“Concerns focus on whether the new laws and policies will have a strong positive social impact or whether they are designed for the benefit of a minority of investors and will ultimately detract from the public welfare,” Bejarano said.

Successful reformation depends upon eliminating monopolies, strengthening competition, updating infrastructure, increasing coverage, fortifying consumer and citizen rights and regulating sectors, Bejarano wrote.

“Unfortunately, the multiple bill drafts proposed by the executive and the legislative branches, as well as the legislative process itself, revealed that the state is not willing to take the steps necessary to eliminate the root cause of deficiencies in this sector,” Bejarano said. “Regulations to increase competition across the industry actually only targeted one player — America Movil. Mexico’s new regulatory agency for telecommunications, IFETEL, obtained only partial autonomy.”

The result is a few cost reductions, but consumers will have to sacrifice more of their privacy and basic human rights, he said. Legal provisions such as data retention, content regulation by the Secretariat of the Interior and geolocation, among others, will only lead to greater government control over citizens without providing significant benefits to them, Bejarano said.