Broadband blues: Affordable high-speed internet options still ways off. (Tech Talk).

It was supposed to change everyone's lives: a single cable enabling voice, data, Internet and video transmissions at what seemed like warp speed. But several years after making a huge splash in the United States, Mexican businesses and consumers are still finding it hard to get their hands on the elusive broadband.

Ordinary people wanting a faster connection to send photos or download music have two basic options: Telefonos de Mexico's (Telmex) Infinitum Prodigy package offers users a 256 KBPS connection for a flat fee of $3000 pesos for the modem and $500 pesos per month. For those in Mexico City, Monterrey and Guadalajara who'd rather not install a dedicated phone line for Internet use, Cablevision offers an equally fast cable modem connection for $380 pesos per month.

Options for businesses are slightly better, with eight different service providers offering connection speeds up to 2.0 MBPS for large file data transfer and even online teleconferencing. But most industry experts agree Mexico should have more choices and blame a series of stumbling blocks for slowing progress. To address this problem and others, industry leaders gathered in Mexico City last month for the annual "e-solutions" conference, sponsored by the AMERICAN CHAMBER OF COMMERCE OF MEXICO.

Tele-tyranny

Not surprisingly, Telmex remains the biggest impediment to a fairer marketplace, said participants, denying competitors full access to its network infrastructure despite the 1997 telecommunications law that was supposed to put an end to such practices. President Vicente Fox is expected to present his telecom reform package to Congress sometime this month, the passage of which is considered crucial to attracting new investment and lowering prices for consumers.

"We won't be able to get there in Mexico if the government doesn't help us," says Carlos Hirsch, director of industry analysis for lusacell.

For Luis Martin del Campo, CEO of Diveo Mexico, one of Latin America's leading providers of Internet and broadband services, it's the private sector that must start doing more. Del Campo says too many things are missing from the Mexican market to badband technology attractive to both businesses and consumers. Underscoring the point, Diveo doesn't even offer broadband services in Mexico and del Campo says the company won't even consider it until next year. He says providers have done a poor job marketing broadband services and that expensive access fees and equipment costs keep the technology beyond the reach of many.

But it's not just cost and access holding Mexico back, says del Campo. Mexican consumers are still lacking the applications and functionality to make broadband useful. "Mexican consumers still don't have a good reason to use broadband," says del Campo.

Craving Connection

Yet another problem is simple connectivity. Mexico's low computer and telephone penetration continues to dog efforts to get ahead. Total online users in Mexico for 2002 is projected at 5.1 million, compared to over 15 million users in Brazil, according to Jupiter Media Metrix. And though the number of voice and data lines is growing daily in Mexico, the vast majority are concentrated in the big cities. Diveo estimates 80% of Mexico's communities only have access to public telephones.

One way around the problem could be the use of wireless networks. Several satellite Internet providers have expressed interest in the Mexican market, hoping to cash in on Mexico's nascent wireless telecom industry. Analysts say the industry could surpass US$100 million in the next three to five years. The advantages of wireless are in the numbers: Upgrading cable for 10,000 customers can cost providers up to US$10 million vs. US$1 million on the same amount of customers with wireless broadband. Carlos Carreras, vice president of Vignette software in Latin America, says broadband will be key in increasing business-to-consumer operations and Mexican online spending, projected to reach US$642 million in 2003, according to Jupiter Data.

"Broadband is going to help more users get to points where they aren't today," says Carreras.

Stevenson Jacobs is a freelance writer and a reporter for a Mexico City daily.