Prospects in Telecom Industry Remain High for 2005 in Latin America

Business Wire, Oct 4, 2005

DUBLIN, Ireland -- Research and Markets (http://www.researchandmarkets.com/reports/c25109) has announced the addition of Telecoms, Mobile and Broadband in Latin America - 2005 - Market to their offering

With over 560 pages of research, Mobile and Broadband in Latin America - Market series contains a comprehensive analysis of the telecoms industry and the companies involved in it.

This research is divided into the following volumes:

Volume 1 - Latin American Convergence, Broadband and Internet Market

Volume 2 - Latin American Telecommunications Market

Volume 3 - Latin American Mobile Communications and Mobile Data Market

Some Findings:

Latin America's economic woes, which peaked in 2001-2002, began to lift in mid-2003, and 2004 proved to be a year of exceptional growth. All telecom sectors benefited most especially mobile telephony and the broadband market. Although economic growth in 2005 is expected to ease compared with 2004, the prospects are still highly promising.

GSM has become the most popular mobile technology for Latin Americans. In fact, in terms of GSM, Latin America is the fastest growing region in the world, soaring by 151% in one year. In broadband, the most popular technology is ADSL, which grew by 104% in 2004.

Infrastructure

Latin America has a low teledensity with only around 17% of the population having a telephone line in early 2005. Telecommunication infrastructure varies from nonexistent to rudimentary and from adequate to well advanced in some major cities.

While most telecom markets in Latin America are both privatized and deregulated, liberalization has mostly advantaged the mobile sector. When it comes to fixed lines, it is not easy for new entrants to build out a network that can compete with the incumbent's. So, fixed-line growth is stagnating even in the major economies such as Brazil, where operators have reached their service goals for line installation and consumers are increasingly favoring mobile.

There is a marked trend towards the use of alternative systems, especially WLL and VoIP, and fixed-line operators are looking to Digital Subscriber Line (DSL) services to increase their revenue potential.

As in the rest of the world, VoIP is one of the most important convergence issues facing regulators. Many ISPs in the region are terminating and originating international long-distance traffic despite not having government approved licences. The key issue is whether VoIP should be classified as a telecom service or as a value-added service. Regulators are undecided as to how to regulate (or not regulate) these services and as a result, the situation in each country is different.

Fixed network operators in Latin America

In terms of revenue, the five leading fixed-line telcos in Latin America are: Telmex (Mexico), Telemar (Brazil), Telesp (Brazil), Brasil Telecom (Brazil), Telecom Argentina (Argentina).

The drive towards consolidation in the region is continuing. The two most outstanding deals in 2004-2005 involved BellSouth's sale of all its Latin American assets to Spain's Telefonica, and AT&T Latin America's sale of its operations to Telmex. Besides AT&T, Telmex also acquired Brazilian Embratel, Argentine Techtel and Chilean Chilesat. Telecom Italia, on the other hand, agreed to sell two of its Latin American operations: Venezuelan Digitel and Entel Chile.

Companies Mentioned:

Telmex (Mexico)

Telemar (Brazil)

Telesp (Brazil)

Brasil Telecom (Brazil)

Telecom Argentina (Argentina)

BellSouth's

Latin American

Telmex

Besides AT&T

Brazilian Embratel

Argentine Techtel

Chilean Chilesat

Telecom Italia

Venezuelan Digitel

Entel Chile

For more information visit http://www.researchandmarkets.com/reports/c25109