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Effect of Telecommunications Deregulation on the Deployment of Intelligent Transportation Systems in Texas and at the Texas-Mexico Border

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Effect of Telecommunications Deregulation on the Deployment of Intelligent Transportation Systems in Texas and at the Texas-Mexico Border Technical Reoort Documentation Paee 1. ReportNo. 2. Government Accession No. 3. Recipient's Catalog No. TTl/ITS RCE-97/02 4. Title and Subtitle 5. Report Date EFFECT OF TELECOMMUNICATIONS DEREGULATION ON June 1997 THE DEPLOYMENT OF INTELLIGENT TRANSPORTATION 6. Perfonning Organization Code SYSTEMS IN TEXAS AND AT THE TEXAS-MEXICO BORDER 7. Author(s) 8. Perfonning Organization Report No. Marcia L. Pincus 9. Perfonning Organization Name and Address 10. Work Unit No. (TRAIS) Texas Transportation Institute The Texas A&M University System 11. Contract or Grant No. College Station, TX 77843-3135 DTFH61-93-X-00017-004 12. Sponsoring Agency Name and Address 13. Type of Report and Period Covered Texas A&M ITS RCE Final: Texas Transportation Institute February 1996 - February 1997 The Texas A&M University System 14. Sponsoring Agency Code College Station, TX 77843-3135 15. Supplementary Notes Research supported by a cooperative agreement from the Federal Highway Administration, ITS Research Centers of Excellence Program. Additional support for this research rpovided by the Texas Department of Transportation and the Texas Transportation Institute Research Project: Improve Transportation Efficiency in the U.S.-Mexico Border Area Through the Use of ITS 16. Absttact In 1996, the U.S. and Mexico passed legislation to deregulate their telecommunications industries. In both countries, telecommunications deregulation dramatically changed the nature of the competitive relationships between telecommunications service and equipment providers, as well as changing the nature of the market in general. These changes will affect the development and use of individual telecommunications technologies, and will also affect the nature of public-private partnerships for the research, development, and deployment of Intelligent Transportation Systems (ITS), particularly at the U.S.-Mexico border. Regulatory changes in the telecommunications sector will affect many of the technologies that form the foundation of ITS, and will also change the nature of the market for telecommunications services and equipment. This study explores in a non-technical fashion the major provisions of both Telecommunications Acts and how each may affect the research and eventual deployment of ITS at the national and state level. This study also specifically addresses how deployment of ITS in the U.S.-Mexico border region may be affected by the interaction of two simultaneously changing telecommunications markets. 17: Key Words 18. Distribution Statement Intelligent Transportation Systems, Mexico, U.S.­ No restrictions. This document is available to the Mexico Border, Telecommunications, public through NTIS: Telecommunications Policy National Technical Information Service 5285 Port Royal Road Springfield, VA 22161 19. Security Classif.(ofthis report) 20. Security Classif.(ofthis page) 21. No. of Pages 22. Price Unclassified Unclassified 112 Form DOT F 1700.7 (8-72) Reproduction of completed page authorized EFFECT OF TELECOMMUNICATIONS DEREGULATION ON THE DEPLOYMENT OF INTELLIGENT TRANSPORTATION SYSTEMS IN TEXAS AND AT THE TEXAS-MEXICO BORDER by Marcia L. Pincus Assistant Research Scientist Texas Transportation Institute Research Report 97/02 Research Project IB-01: Improve Transportation Efficiency in the U.S.-Mexico Border Area Through the Use of ITS Sponsored by the Texas A&M ITS Research Center of Excellence June, 1997 TEXAS TRANSPORTATION INSTITUTE Texas A&M University System College Station, TX 77843-3135 ACKNOWLEDGMENTS Support for the research reported herein was provided by a Federal Highways Administration cooperative agreement to the Texas A&M Intelligent Transportation Systems Research Center of Excellence. Support was also provided by the Texas Department of Transportation. The contents of this paper reflect the views of The author, who is responsible for the facts and accuracy of the information presented herein. The U.S. Government and the Texas Department of Transportation assume no liability for the contents or use thereof. v TABLE OF CONTENTS ACKNOWLEDGMENTS ................................................ v CHAPTER 1. EXECUTIVE SUMMARY ................................... 1 Challenge . 1 Objectives . 1 Why Is Telecommunications Important? . 1 Conclusions ...................................................... 2 CHAPTER 2. TELECOMMUNICATIONS AND INTELLIGENT TRANSPORTATION SYSTEMS ......................................... 5 Introduction ...................................................... 5 Intelligent Transportation Systems (ITS) . 6 The Telecommunications Industry ................................... 8 Telecommunications Technologies ............................. 8 Telecommunications Hardware . 10 Telecommunications Industry Stakeholders . 11 Conclusion . 11 CHAPTER 3. THE TELECOMMUNICATIONS ACT OF 1996 ............... 13 Provisions of the Telecommunications Act of 1996 ..................... 13 Implications of the 1996 Act ........................................ 16 Service Bundling . 16 Partnering and Alliances .................................... 18 Technological Advancement ................................. 22 CHAPTER 4. IMPACTS OF THE 1996 ACT ON ITS ....................... 25 Introduction ..................................................... 25 Telecommunications Technologies in Support of ITS .................. 26 The Telecommunications Act of and ITS in the State of Texas ............ 28 Partnering and Competition ................................. 30 The 1996 Act and Right-of-Way Issues ............................... 32 Political Issues ............................................. 35 Financial Issues ............................................ 36 CHAPTER 5. MEXICO'S TELECOMMUNICATIONS REVOLUTION ....... 39 Mexico's Telecommunications Industry- Overview ................... 39 Competition in Mexico's Telecommunications Industry ................ 40 Mexico's 1995 Telecommunications Law ............................. 42 Satellite De-Monopolization .................................. 43 Telecommunications Legislation .............................. 43 vii Reorganization of the SCT and SCDT .......................... 45 Implications of Mexico's Telecommunications Legislation .............. 45 Mexico's Long-Distance Sector ..................................... 47 Mexico's Cellular Industry ........................................ 49 Computer Technologies and the Development of the Internet in Mexico . 50 Conclusions and Update .......................................... 51 CHAPTER 6. THE EFFECTS OF CHANGES IN THE TELECOMMUNICATIONS INDUSTRY ON ITS IN THE TEXAS-MEXICO BORDER AREA ............. 55 Telecommunications and Economic Development ..................... 55 Telecommunications as a Factor of Production and Part of the Value-Added Chain ........................................ 55 Maquiladoras, Telecommunications, and ITS ......................... 57 Telecommunications and ITS in the El Paso-Ciudad juarez Area ... 58 Cross-Border Commercial Activity and ITS ........................... 60 Commercial Vehicles and ITS ................................ 62 North American trade Automation Prototype (NATAP) .......... 63 Summary ....................................................... 65 CHAPTER 7. MAJOR FINDINGS AND RECOMMENDATIONS ........... 67 General Recommendations ........................................ 67 Recommendations and Responsibilities - The Public Sector ............. 67 The Federal Government .................................... 68 The States ................................................. 69 The State of Texas and the Texas Department of Transportation .... 72 Recommendations and Responsibilities -The Private Sector . 77 Closing Comments ................................................ 77 Appendix A. ITS-Specific Wireless Communications Applications .......... 81 Appendix B. Frequency Allocation Table ................................ 87 Appendix C. Benefits of Telecommunications in the Value-Added Chain .... 89 Appendix D. Examples of Telecommunications Technologies in Maquiladoras .......................................... 91 Appendix E. How Does Telecommunications Work? ....................... 93 REFERENCES ....................................................... 101 viii CHAPTER 1: EXECUTIVE SUMMARY CHALLENGE In 1996, the U.S. and Mexico passed legislation to deregulate their telecommunications industries. In both countries, telecommunications deregulation dramatically changed the nature of the competitive relationships between telecommunications service and equipment providers, as well as changing the nature of the market in general. These changes will affect the development and use of individual telecommunications technologies, and will also affect the nature of public-private partnerships for the research, development, and deployment of Intelligent Transportation Systems (ITS), particularly at the U.S.-Mexico border. OBJECTIVES Regulatory changes in the telecommunications sector will affect many of the technologies that form the foundation of ITS, and will also change the nature of the market for telecommunications services and equipment. This study explores in a non-technical fashion the major provisions of both Telecommunications Acts and how each may affect the research and eventual deployment of ITS at the national and state level. This study also specifically addresses how deployment of ITS in the U.S.-Mexico border region may be affected by the interaction of two simultaneously changing telecommunications markets. WHY IS TELECOMMUMCATIONS
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