 | Issue: | Latin America IV 2001 |
| Article no.: | 7 | |
| Topic: | The Government’s Role in Mexican Telecommunications | |
| Author: | Jaime Chico Pardo | |
| Title: | Chief Executive Officer | |
| Organisation: | Telmex | |
| PDF size: | 20KB |
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Article abstract
With the end of the millennium, humanity observed how the global world reduced distances and brought human beings closer together. On September 11th, we discovered how globalisation had been disrespectful to society. The global environment was overwhelmingly shaken by local scenarios, each with its own culture and personality. Our world was revealed to be a fireplace of customs, voices, traditions and beliefs. In this scenario, society is now facing a process of regional reorganisation where culture, national identity and roots will provide support for development towards a new stage of globalisation.
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On the other hand, the ‘digital economy’ companies entered into a crisis by focusing their existence only on innovation and investment, leaving efficiency and profitability aside. Today, the world’s industry faces the need to consolidate the ‘digital economy,’ hand in hand with the new technology. In a real world, it helps to reduce costs, optimise commercial relationships and have a platform to create new businesses and strengthen revenues. With this new focus in mind, the globalisation process begun last century does not stop, on the contrary, it takes on new momentum and gives technology a human face. Given these realities, Mexico faces the challenge of taking part in the construction of this new worldwide scenario. The government, corporations and society as a whole share the task of triggering our nation to participate in the ‘fourth wave of humanity’, defined by some as the knowledge wave. If Mexico is to fully take advantage of the strength of the latter, we must focus our vision on common targets. Realities like the new digital culture, the developing balance between regional interests and globalisation, and the development of new technologies, should become the drivers for our nation’s growth. This implies that our country should create conditions for our youth to participate-not only as consumers but also as creators-by proposing and imagining a new level of knowledge and experience. It is through these new creative minds that we will obtain the benefits of globalisation and technological advances for our country. Telecommunications: the Strategic Sector of Modern Economies At the awakening of the new century, the century of the information society, the Mexican government should recognise the strong need to drive the construction of a solid information technology and telecommunications industry. Such an industry, whose only purpose is to strengthen Mexico at all levels, should also be dynamic, integrated and innovative. At this time, our country is passing through a critical stage in the definition of our domestic telecommunications policy; existing laws will have to be adapted as a result. There is, nevertheless, real risk of creating regulations aimed, essentially, only at restricting one major player. Instead, Mexico needs to create a policy that strongly encourages domestic growth based upon the overall expansion of this industry. Prior to the privatisation of the TELMEX system 13 years ago, it was essential to define precise goals to be included in the Título de Concesión (Title of Concession). These goals were needed in order to evaluate the new company’s performance. Quality, investment, growth, teledensity and coverage targets were all included in that Title. Financial analysts in The City and Wall Street deemed these goals to be impossible to meet, regardless of who won the bid. TELMEX´s new management and employees not only fulfilled the goals, but through training, investments and productivity successfully exceeded them. Now, it is the time when government, industry, and society should set new goals and not limits. The new goals should not only apply to one player, but also define the path of the entire Mexican industry. Any adaptation of the current telecommunications law needs to establish national objectives focused on three priorities-convergence, investment and social coverage. Convergence Today, technological convergence allows simultaneous interaction, over a single network, between such different modalities as voice, data and video. By permitting service providers to freely offer services based on this convergence, the Mexican government would enable people to access a wider range of benefits from a single convergent point of contact, thereby reducing the hassle of obtaining them. Given all this, the government should: o promote the non-discriminatory participation of concessionaires in the new markets that consumers demand; o not limit alliances between telecommunications and content companies that offer convergent services. It is a fact that foreign companies with these types of alliances are currently participating in our market. At the same time, the domestic industry has had limits imposed that prevent it from competing on an equal basis. We should broaden our horizon and imagine our domestic companies competing efficiently in other markets and measuring themselves in terms of integrating service capacity. Social Coverage At the same time that the Mexican government provides the industry with the elements required to compete in an international scenario, it should also focus on the large domestic challenge in telecommunications. Our community demands sensitive actions incorporating the unique needs of Mexican regions as diverse as the Mixteca in southern Mexico or the Rio Grande Valley on the northern border. Hence, adaptations of the telecom law must internalise these unique realities of our country, and not import foreign regulations. Investment Investments should not be selective. It is not possible to allocate resources in large urban areas with high income levels, and, simultaneously, ignore development needs in less developed regions. Therefore, when it comes to investment, our country’s needs demand a national plan of social coverage that establishes growth and teledensity objectives for voice, data and Internet access. Broadly speaking, this plan should define goals for each firm, establish methods for evaluating compliance and impose penalties upon those failing to meet their obligations. Such a plan would impose upon all concessionaires the responsibility of offering those means for social development they control to all communities throughout the nation, regardless of their location. In order to carry out this national initiative of social coverage, a universal trust is not the solution. Instead, the government must effectively promote, through fiscal incentives, accelerated investment in creative solutions that bring connectivity closer to the community. Furthermore, the government should establish a rule of law that guarantees respect for legal security and profitability for each player in order to permanently attract investment in telecommunications for the regions with the greatest teledensity challenges. The government, in adapting the current telecommunications law, need always be aware of the rules imposed by a market economy. This means that the telecommunications sector should be guided by an investment model that guarantees its constant evolution. The model must recognise the real costs of the infrastructure and make it available, by way of just compensation, to anyone wishing to make use of it. Finally, the limited economic capacity of most Mexicans is the ultimate challenge that we face as a nation in order to meet the objective of social coverage. The Government and society face a structural problem that is not determined by the availability of investment resources, but by the need to build an economic base that increases the income of the Mexican people and makes the strengthening of the internal market a priority. I am convinced that the nation-concept, as currently proposed, must necessarily call upon all participants to engage themselves in the technological integration of our entire society. We all need to realise that the information technology and telecommunications industries are strategic sectors of modern economies. They will play a key role in any responsible globalisation process. Most importantly, we all need to realise that the country’s interests should determine our own destiny. Our destiny is to fortify our country through investment, efficiency and competitiveness. The aim is clear: to provide all Mexicans with the opportunity to communicate among themselves at any time and in any place. Mexico is at a decisive turning point. Its destiny depends not just upon the struggle of all Mexicans but also upon the focus and the rhythm of the struggle. We must take the time to define a model that allows us to conquer the digital divide. Conclusion We face a great opportunity: that of building a strong and legitimate domestic project that fully responds to our priorities and proposes creative and nimble alternatives-a project full of national pride in which culture and traditions are valuable tools to enhance technological development. Today, more than ever, we have in our hands the opportunity to transform our nation by shortening the path towards development for millions of Mexicans.
