Interview : Sergio Rosengaus

How have telecoms network upgrades undertaken in recent years benefitted the industry?

SERGIO ROSENGAUS: The government did very well by initiating the Red Compartida, or Shared Network project, in 2015. Mexico needed a substantial upgrade to its telecommunications network, and this endeavour has been a cornerstone of its modernisation. Three main pillars – better network quality and wider reach for the whole country, more competitive prices, and higher-quality services in alignment with international standards – have now been achieved.

These have boosted the sector, turning the country into a propitious land for private and foreign investment, lowering telecommunications prices, and creating new and innovative services. Businesses that were previously struggling due to poorly developed infrastructure are now able to release their solutions to the market. For instance, firms offering services based on the internet of things can now compete in a sustainable way. Smart cities are becoming a reality thanks to higher infrastructure standards, and regions that were once isolated are now connected.

However, despite a promising reform approved in 2014, the energy sector is still not offering competitive prices and services to improve its technological prospects. This has a direct effect on the quantity and quality of services that can be offered to companies and to the public. If IT and telecoms companies are given access to cheaper and renewable energies the Red Compartida will unlock unprecedented potential for dynamism in the sector.

How will digitalisation affect the economy, and how can firms use this to their advantage?

ROSENGAUS: Digital transformation is now a reality for every industry. From small structures that produce highly demanded local products to large entities that have activities and services with a global reach, digitalisation is necessary to stay competitive.

Certain markets tend to be more affected by technological progress, and the retail industry, for example, has become a very disruptive ecosystem. There are constant evolutions at different levels of the supply chain, and companies need to adapt and be a step ahead in order to stay competitive. Innovation in logistics has been a key consideration for companies in the retail industry; consumers are requesting faster deliveries, varied choice and digital-based services in order to tackle proximity issues. For companies in the Fortune Global 500, digital transformation represents a competitive and financial challenge. This transformation requires converting old processes into new digital solutions. For this reason, IT and telecoms companies have become key facilitators in that area.

What impact will the new cybersecurity strategy have, and what progress has already been made?

ROSENGAUS: The Ministry of Finance and Public Credit has done a very good job in designing this strategy. Mexico is undergoing a digital transformation; therefore, generating awareness about a matter such as cybersecurity was necessary for both public institutions and private actors. As mutual dependence between digital actives and security is growing, there must be extremely well-prepared professionals to defend Mexico’s private assets and to build better prepared private actors.

Even if digital assets are intangible, they represent a significant part of a company’s valuation. While the majority of modern executives are aware of this and understand how to roll out agile and efficient cybersecurity strategies, not everyone in the country is prepared to do so. That said, compared to other countries in Latin America, Mexico is at the forefront, becoming a regional leader in data security, personal data privacy and cybersecurity for other neighbouring countries, such as Guatemala and Panama.