In 2012, the mobile industry generated more than 3.7% of Latin America’s GDP, contributing U.S.$211 billion to the region’s economy. Latin America now accounts for 10% of the global mobile market in terms of revenue, more than double the percentage from ten years ago. A new report, “Mobile Economy Latin America 2013”, developed by GSMA Intelligence, shows that mobile revenue in the region totaled U.S.$107 billion in 2012 with a 9% year-on-year growth rate, making Latin America the second fastest growing globally.
As of June 2013, Latin American had 632 million connections and 319 million unique subscribers—a penetration rate of 104% and 52% respectively. GSMA noted that Latin America is entering a new phase of development, characterized by increasing market maturity and higher levels of competition with revenue and subscriber growth slowing. In other words, GSMA classifies most countries in the region as “fast growers.” With the voice market becoming more saturated (active SIM penetration in many countries is now more than 100%), growing new revenue sources is the new strategic focus for operators.
Future growth will come increasingly from mobile broadband and related new applications and services. Smartphone penetration will be close to 20% of the population at the end of 2013.
More LTE services: Movistar Chile has launched commercial LTE services across the country. The carrier, which belongs to the Spanish group Telefónica, is using the 2.6 GHz frequency band for LTE. The launch comes after the Movistar rival in Chile, Claro, started LTE services in March.
Movistar plans to double its coverage area in 2014 and 2015. In a statement, CEO Roberto Muñoz said that the company has also invested U.S.$1.25 billion over the past 24 months to boost its 3G network.
Movistar made 14 smartphones available for its LTE offering.
Acquisition: Tigo Bolivia has acquired the pay-TV company Multivisión to broaden its range. Tigo, a Millicom subsidiary, already offers telephony and Internet services. According to reports, Tigo paid U.S.$20 million for Multivisión. Additionally, Tigo will invest another U.S.$10 million during 2014 to improve services.
More news from the Latin American region:
- Colombian authorities fined Telmex Colombia and Telmex Telecomunicaciones, which are both part of Mexican magnate Carlos Slim’s business empire, for failure to respond to users’ concerns. The industry and commerce regulator fined each company 1.18 billion pesos (U.S.$612,000), the maximum allowed under laws governing Colombia’s telecommunications sector.
- Digicel is preparing a €1 billion bid for Orange’s Dominican Republic operations. According to reports, Cable & Wireless, which owns Digicel’s Caribbean mobile rival, Lime, is also among the bidders as well as Grupo León Jimenes, a local conglomerate with interests in tobacco, beer and banking.
- Chinese PC vendor Lenovo will invest approximately U.S.$100 million in a software research and development (R&D) center in São Paulo, Brazil. The facility will provide an estimated 100 jobs. It is Lenovo’s first R&D center dedicated to software development for Lenovo’s Enterprise Product Group, according to a statement from the company.
- Level 3 Communications has augmented and updated its network infrastructure across the Latin American region. The goal is to meet the increased demand for IP solutions, mostly in Argentina, Brazil, Colombia and Venezuela.
- Brazil closed October with 269.92 million mobile lines, of which 730,574 were LTE accesses. Although the number of LTE lines is increasing monthly, LTE represents only 0.27% of the total, which is still dominated by GSM (62.65%).
