I would like to share a translation of the latest article published by Enrique de la Madrid* in Mexico’s El Universal newspaper. It discusses some initial positive effects of the reform in telecommunications, with some important foreign investment coming into the country in a relatively short period of time, and more competition that should benefit the Mexican consumer in the mid term. I hope you will find it interesting. As always, let us know if we can support your business operations in Mexico or Latin America. * Enrique de la Madrid is the General Director of Bancomext, Mexico's National Export Development Bank.

1. www.nuricumbo.com
Telecommunications Reform. Visible Results
By Enrique de la Madrid
In the knowledge economy, access to quality communications and data services at competitive prices is
not only a necessity, but also a right which is essential to increasing this country’s growth potential as
well as individual wellbeing. It is the State’s responsibility to ensure that this public service is provided
competitively. This is the reasoning behind the recent telecommunications reform, which takes on every
aspect of this key sector of the economy, proposing an institutional framework of independent
regulators, as well as important incentives to encourage greater competitiveness, a reduction in fees
and technological advancement.
On July 14 of last year, President Enrique Peña Nieto enacted the second round of the
telecommunications reform legislation. Less than one year after its publication, concrete results can
already be seen, foremost among them the creation of the Federal Telecommunications Institute
(IFETEL), an autonomous regulator for the sector which also serves as an authority on issues of
economic competition and the provision for foreign investment – up to 100 percent in
telecommunications, and 49 percent in radio broadcasting.
Within the telecommunications framework, the IFETEL identified América Móvil as the largest of the
telecommunications companies, in response to which the company announced that it will sell assets in
order to avoid being subject to asymmetrical regulation. The regulatory body also flagged Televisa as a
dominant agent in radio broadcasting, imposing specific regulations to create conditions more favorable
to competition.
With regard to foreign investment, AT&T has set aside 4.375 billion dollars to buy Iusacell and Nextel;
the purchase of the latter is subject to approval by the authority. Furthermore, Eutelsat
Communications acquired Satmex for 831 million dollars and Virgin Mobile began operations in Mexico
with an investment of 45 million dollars. These investments increase competition and service choices for
customers. It will also generate demand for qualified personnel, creating more and better jobs.
According to the Bank of Mexico, from the reform’s approval in June of 2013 to February of 2015, the
prices of mobile telecommunications have fallen by 16%, while international long distance costs have
gone down by over 40%.
As a result of this reform, the Ministry of Communications and Transport has set up the “Mexico
Connected” program, the purpose of which is to provide broadband internet in 250 thousand public
buildings and spaces. By November of 2014, a total of 65 thousand 149 public places had been
incorporated, a figure surpassing the proposed target of 65 thousand. 74% of spaces with internet are
on school properties.

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Other highlights of the reform include country-wide mobile telecommunications connections at no
extra cost, number portability, the possibility for users to be reimbursed for service failures, free
consultation of prepaid balances and the extension of their validity of up to one year.
As part of the transition to digital television, low-income families will be guaranteed access. For this
purpose, as of February of 2015 2.3 million televisions have been distributed out of a target of 10
million.
The telecommunications reform is one of the structural reforms promoted by President Peña Nieto as a
means to break down the barriers to economic growth, in order that this country’s economy may grow
at a much higher rate and create more jobs with higher wages, thereby raising the standard of living for
all Mexicans.
@edelamadrid
The author is the General Director of Mexico’s Export Bank (Bancomext).
This article was originally published in El Universal Newspaper on 13 March 2015.
http://www.eluniversalmas.com.mx/editoriales/2015/03/75313.php
Translation provided by Nuricumbo + Partners
Nuricumbo + Partners is a consulting firm based in Mexico City.
We are specialists in Mexico and Latin America.
Our lines of business include:
 Covering interim finance positions at the CFO/Controller level
 Performing special audit projects (due diligence, internal controls, fraud prevention)
 Business development and business representation in Mexico