Latin American Telecom Industry Outlook 2009 V2


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Draft presentation for upcoming IBC VAS LATIN AMERICA Conference, Miami, June 2009.

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Latin American Telecom Industry Outlook 2009 V2

  1. 1. Latin American Telecom Industry Outlook 2009
  2. 2. Latin America Mobile Market The Latin American mobile market is incredibly complex. Each country shows remarkably different subscriber usage behavior patterns and adoption of technologies. This translates into different needs and consequently, different opportunities for each market.
  3. 3. LATAM to grow at slowest pace in seven years LATINFOCUS expects Latin America to grow at the slowest pace in seven years. Industry analysts estimate wireless subscriber growth in 2009 to be between 5% (Yankee Group) and 8% (Moody's), down from double digit growth in previous years.
  4. 4. Operators face delayed investments, reduced CAPEX and slower growth rates. Pricing might be an option to grab new subscribers but in a year of economic hardship and with subscriber growth coming mainly from lower ARPU segments, price discounts can only get them so far.
  5. 5. Operators will limit CAPEX to maintain healthy cash flows. Since the region is still expected to grow in total number of subscribers, expanding capacity of existing network infrastructure will be their top priority.
  6. 6. Despite the downturn, some operators still expect 10% subscriber growth for 2009. With mobile penetration reaching saturation in major markets and slower growth rates this year, the only way they can achieve this is via churn from other operators.
  7. 7. Even as subscribers limit spending there are opportunities to generate revenue,. Opportunities can come from increased MOU or SMS, introducing SMS based services in countries with low voice usage or new data services where usage and ARPU show potential for rapid adoption.
  8. 8. Opportunity Map Latin America The chart above shows three key factors: (x) Average Monthly SMS; (y) MOU - Minutes of Usage; and ARPU - Monthly Average Revenue per User (bubble size) for the six largest markets in the region; Brazil, Mexico, Chile, Colombia, Venezuela and Argentina.
  9. 9. Opportunities can also be found in network productivity improvement. Some of these opportunities can be positioned as new services; this year operators will have limited resources but they cannot afford to miss opportunities to maintain or improve their position in the market.
  10. 10. Latin America Mobile Market Doing business in Latin America is becoming increasingly challenging; the region is incredibly complex and major players have consolidated their presence and gained negotiating power. Understanding the market and the specific needs of each country can help identify opportunities in Latin America, a market that is complex, fascinating and full of potential.
  11. 11. Raul Castanon