by Javier Solis Garcia
25. September 2009 14:26
The mobile market in Latin American is one of the hottest worldwide, having experienced a major growth in the last five years.
A recent study by the International Telecommunication Union shows that around 80% of the population in the continent has a mobile phone and that countries such as Argentina, Uruguay or Panama have higher mobile penetration than Canada or the United States.
With regional penetration likely to exceed 100% soon, mobile voice service expending has significantly moderated its growth: analyst predict CAGR rates below 4% until 2013 for mobile voice.
Mobile value added services and applications for personal communications may very well come to the rescue and become the next growth driver. But today, mobile data services in the region still have a low incidence, with most revenue coming from SMS and there are technical and business challenges ahead.
With smart phones representing only around 5% of the telephone sales in the region according to a July 2009 report from Business News Americas Intelligence Series, SMS is positioned as an interesting entry level platform for the delivery of new services and a stepping stone for more complex data applications. Technology advances (Java, On Device Portals, Rich Communication Suite, etc.) are also erasing the line between normal and smart phones allowing for new applications to address a broad range of subscribers.
A major challenge will be building interest about these services in the customers. Being a region with a predominantly cost sensitive prepaid user base it is an interesting environment to foster innovative ways to increase ARPU: try and buy programs, service bundles, application stores, open labs for third party developers, ad-based business models, and more.
Key players América Móvil and Telefónica, which account for some two out of three mobile subscriptions in the region, are already preparing for expanding their market through mobile data services which points to Latin America remaining a very hot market.