Baker Institute expert weighs in on Mexican telecommunications reform

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David Ruth
713-348-6327
david@rice.edu

Jeff Falk
713-348-6775
jfalk@rice.edu

Baker Institute expert weighs in on Mexican telecommunications reform
Álvarez: The Mexican ‘must carry, must offer’ regulations have many flaws  

HOUSTON – (June 9, 2015) – Mexico’s budding telecommunications reform may have opened the door for increased competition, but it has done little in regard to content, copyright holders or television audiences, according to a telecommunications expert at Rice University’s Baker Institute for Public Policy.

Credit: thinkstockphotos.com/Rice University

Clara Luz Álvarez, a nonresident scholar in the institute’s Mexico Center, a member of the Mexican National Researchers System and a professor at the Universidad Panamericana, outlined her insights in a new issue brief, “Must Carry, Must Offer in Mexico.”

Mexico’s free-to-air television programming has long been dominated by two corporate groups: Televisa and TV Azteca, according to Álvarez. They jointly hold — directly or through subsidiaries — 95 percent of the commercial licenses, 90 percent of audience share and 99 percent of the advertisement income. Televisa is also a major pay-TV player, controlling 62 percent of the market with its cable and satellite companies.

With this level of high concentration in the television sector, Mexico’s 2014 telecommunications reform established constitutional “must carry” and “must offer” (MC/MO) regulations, which are “two sides of the same coin,” Álvarez said. “Must carry” refers to the obligation of pay-TV providers to include free-to-air channels in their programming packages. “Must-offer” regulations, on the other hand, mandate that free-to-air broadcasters offer their channels to pay-TV licensees so the channels can be included in pay-TV programming packages.

“While the reform legislation places rhetorical importance on promoting culturally diverse and pluralistic content for all broadcast audiences, there is little substantive commitment to these ideals,” said Álvarez, who previously was a commissioner for Mexico’s Federal Telecommunications Commission (Cofetel) and the head of Cofetel’s legal affairs office (2003-06). “The Mexican variation of MC/MO is an ad hoc policy with many flaws. Congress failed to duly assess the impact on other provisions, like those related to the copyrights of content creators. Ultimately, the Supreme Court will determine the future of MC/MO in Mexico. Given the reform’s legal framework, however, content diversity and pluralism will not be enhanced by MC/MO in Mexico.”

Truly independent local channels are very limited in Mexico, Álvarez said. “Increasing the diversity and pluralism of content has been a key rationale behind MC in other countries,” she said. “In Mexico, however, satellite providers are only obliged to carry programming that reaches 50 percent of the country. Satellite makes up nearly half of all pay-TV providers in Mexico, so this greatly diminishes the influence of MC on content diversity and pluralism.”

To determine which free-to-air TV channels would be distributed through satellite TV, Mexico’s Federal Telecommunications Institute identified — with information annually provided by broadcasters — the channels that had at least 75 percent of the same programming from 6 a.m. to midnight, even if this programming was presented in a different order. “In other words, there was no assessment whatsoever as to how this content contributes to pluralism and diversity,” Álvarez said. “Of course, with the 50 percent stipulation, the law also puts local content at a disadvantage.”

In a country where 73 percent of citizens obtain information through television, the companies that control TV content are especially powerful, Álvarez said. “Pluralism and diversity are two of the main challenges to the quality of Mexico’s telecommunications sector,” she said. “Establishing ways to achieve these goals would limit the influence of Televisa and TV Azteca, allowing people to receive and interpret information from a broader array of sources and ideological perspectives.”

For more information or to interview Álvarez, contact Jeff Falk, associate director of national media relations at Rice, at jfalk@rice.edu or 713-348-6775.

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Follow the Baker Institute Mexico Center via Twitter @BakerMexicoCtr.

Follow Rice News and Media Relations via Twitter @RiceUNews.

Related materials:

Issue brief: http://bakerinstitute.org/research/must-carry-must-offer-mexico.

Álvarez biography: http://bakerinstitute.org/experts/clara-luz-alvarez.

Baker Institute Mexico Center: http://bakerinstitute.org/mexico-center.

Founded in 1993, Rice University’s Baker Institute ranks among the top 10 university-affiliated think tanks in the world. As a premier nonpartisan think tank, the institute conducts research on domestic and foreign policy issues with the goal of bridging the gap between the theory and practice of public policy. The institute’s strong track record of achievement reflects the work of its endowed fellows, Rice University faculty scholars and staff, coupled with its outreach to the Rice student body through fellow-taught classes — including a public policy course — and student leadership and internship programs. Learn more about the institute at www.bakerinstitute.org or on the institute’s blog, http://blogs.chron.com/bakerblog.