Pay phone operators slammed by Mexico
(San Antonio Express-News; 06/16/98)
MEXICO CITY - Mexico clamped down on hundreds of illegal telephone exchanges
for over-billing Monday, saying the kiosks charged tourists rates of as much as
$25 to make a three-minute, long-distance call.
The government removed or dismantled 759 public telephones that were
charging unregistered fees and illegally bypassing local lines belonging to
Telefonos de Mexico SA. Those telephones used operators, often in the U.S., to
transfer calls out of the country.
Eight Mexican companies, including Landmark Communications SA, Modutel
Comunicaciones SA and BBG Comunicaciones SA, were accused of overcharging on
calls from phones in the resort towns of Cancun, Puerto Vallarta, Culiacan and
Ciudad Juarez and Tijuana, on the U.S. border.
"These users were not respecting long-distance regulations. This has been
damaging Mexico's image abroad," said Javier Lozano, chairman of the Federal
Telecommunications Commission, a government agency.
American TeleSource International de Mexico SA - a subsidiary of San Antonio-
based American TeleSource International Inc. - was among three companies
licensed to operate telephone services, but charged in the sting of violating
the conditions of their concessions.
Officials with American TeleSource said the Mexican government removed 45 of
its 1,200 phones because they were not "smart phones" capable of accepting,
cash, credit cards and pre-paid calling cards. The Mexican government wants
all pay-phone operators across the country to replace their old phones with
new smart phones.
Although 900 of American TeleSource's phones use the new technology and it
is in the process of replacing its old phones, it had not moved fast enough to
satisfy the Mexican government, said Arthur L. Smith, the company's chief
"This came on suddenly," said Smith, who added that the company has met with
government officials since the crackdown and has sped up its plans to replace
the old pay phones.
American TeleSource's decision to speed up the replacement could decrease
its short-term revenues by up to 10 percent, Smith said.