Mexico Still Plans to Cut Service to Millions of Cell Phones

Last Saturday at midnight, the deadline passed for Mexican cell phone subscribers to register their phones with the government's National Registry of Mobile Phone Users, or Renaut. If they did not, the Mexican government promised to soon begin cutting off their cell phone service. It now looks like the government is going forward with its promise starting tonight.

An estimated 24 million out of the Mexico's 83.5 million cell phone subscribers have yet not registered their cell phones on the registry, various newspapers report. The Mexican government's Federal Telecommunications Commission web site shows 58,297,065 cell phones registrations as of this posting.

To register, a cell phone subscriber, says this Miami Herald story yesterday, "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."

The Herald story also reports that Hector Osuna, a top telecommunications official, says that a gradual suspension of unregistered numbers will begin later today.

The government's purpose in setting up the National Registry is to reduce the number of crimes such as extortion schemes (e.g., where a loved one is claimed to have been hurt or abducted, and the family is told to send money for medical care or their release)  using cell phones. Some 120,000 extortion attempts by telephone were said to have occurred last year alone.

Many cell phone users have resisted registering their cell phones and are calling the promised government suspension of service unfair. Thousands of others have registered their phones in the name of prominent government officials as a way of protest.

The suspension of service will not only likely be ineffective, say critics of the scheme, but it will likely lead to even more cell phone theft. According to this Wall Street Journal story, cell phone theft is the cause of some 40% of street muggings in Mexico City. In addition, the Registry may lead to more identity theft as criminals decide to register their phones using a person's stolen name and Population Registry Unique Code.

Business analysts think the government will back down once it starts losing tax revenue. The Miami Herald story says that the mobile operators would lose about 4 billion pesos (about $300 million) a month in taxable revenue if the number of unregistered cell phone subscribers remain at about 30%.

The WSJ story also says that Mexico's biggest mobile phone operator, América Móvil SAB, was able late yesterday to get a provisional court order blocking the suspension of cell phone service of its customers not yet on the National Registry. America Movil has some 59.2 million cell phone customers.

The WSJ story doesn't say whether the government is going to appeal the decision or what other actions it will take in light of it. I'll let you know what happens as this story plays out.

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