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Mexico threatens to cut off millions of cell phone users

Posted by Sylvia on April 13, 2010, 8:34 pm

Mexico threatens to cut off millions of cell phone users
By Tim Johnson, McClatchy Newspapers Tim Johnson, Mcclatchy Newspapers Tue Apr 13, 5:24 pm ET

MEXICO CITY Millions of cellular telephone users across Mexico face the threat that their service will be cut off as soon as Wednesday for failing to register their telephone numbers with the government a requirement aimed at curbing a rash of telephone extortion attempts.

Only 70 percent of Mexico's 83 million cell phone subscribers had registered their numbers by Tuesday afternoon, several days after a weekend deadline, according to the Web site of the Federal Telecommunications Commission .

A gradual suspension of unregistered numbers would begin Wednesday, Hector Osuna , a top telecommunications official, said.

Some private analysts doubted that the government would carry through on its threat to force cellular companies to suspend service on a massive scale, saying the economic effects would be too heavy, including in lost federal tax revenues.

"It is very difficult to quantify, but it would be severe," said Ernesto Piedras of the Competitive Intelligence Unit, a telecommunications consultancy in the capital.

The major mobile providers alone stand to earn 4 billion pesos (about $300 million ) less each month if service to all unregistered phones is suspended, Piedras said.

Last year, Mexico's Congress mandated that cellular phone users list their names and other personal data with a national registry as a way to cut down on runaway extortion schemes, some of them operated by gangs within prisons using cellular phones. Criminals carried out more than 120,000 attempted extortions by telephone last year, according to an advocacy group, the Citizens Council for Public Security .

Antonio Romero , a purified water distributor, said his home recently received one such demand.

"They called my mom and said, 'Your son has been in an accident. You need to deposit 5,000 pesos in a bank account (for medical care).'" She suspected fraud and reached her son, who was fine.

Some calls fraudulently allege a family member has been abducted. The average demand for payment is 3,000 pesos (about $250 ), the Citizens Council said.

The registration scheme has been plagued by problems. Thousands of cellular phone users, mocking the program, have registered under the names of President Felipe Calderon , former President Vicente Fox or Mexico City Mayor Marcelo Ebrard . Others have found the registration process confusing.

Cell phone users can either send a text message with their personal details to the registry or visit a retailer to register. Registration requires an individual ID number, known as the Population Registry Unique Code, a number similar to a Social Security number in the U.S., but which isn't as widely used in Mexico . Some elderly Mexicans have never obtained the ID number.

One telecommunications analyst said he thinks the government will back down from suspending service on a massive scale.

"I don't think it's going to happen," said Fernando Pafumi , a senior analyst based in Miami for Pyramid Research , a technology consultancy. "The cellular companies will lose a lot of revenue and the Mexican government will also lose taxes."

If they lose service, some poor rural cell phone users may never obtain another phone account, locking them further into poverty, he said.

One newspaper columnist suggested the government would be better off blocking cellular phone signals around prisons, a move resisted by regulators concerned that those living near jails would also lose service.

A 21-year-old law student, David Yanez , described the registry process as "bothersome" and said criminals would simply register using false names.

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