Telecom Lead Asia: Mobile broadband services revenue in Latin America to grow to $34.41 billion in 2017 from $6.74 billion in 2011.
The substantial increase will be driven by increasing demand for mobility, penetration of smart devices, and convergent services and bundles.
By the end of 2011, handsets already accounted for 80.5 percent of all mobile broadband connections.
The increasing coverage of 3G, 3.5G, and 4G networks and greater penetration of low-cost smart devices has significantly increased the revenue generation opportunities of mobile broadband service providers in Latin America.
Mobile broadband is emerging as a likely substitute for fixed broadband in metropolitan areas, both in the residential and corporate segments, according to Frost & Sullivan.
“Consumer behavior has changed in recent years, resulting in higher demand for mobile Internet to access social network applications, instant messaging, mobile voice over Internet protocol (VoIP), and many other value-added services and applications,” said Frost & Sullivan Telecommunications Team Leader, Renato Pasquini.
Though the market has vast potential, it is pegged back by regulatory delays on spectrum auctions, low spectrum caps, and lack of competition in distant regions and rural areas. In addition, users’ inadequate knowledge regarding smart devices restrains its adoption in several zones.
These challenges are compelling mobile operators to formulate innovative strategies and service plans to deal with the data traffic explosion and obtain returns on investment. Further, national broadband plans implemented by governments inBrazil, Chile, and Colombia are stimulating mobile broadband coverage.
Mobile operators also need to work on network upgrades, planning and monitoring as well as building Wi-Fi hotspots for traffic upload, as it can minimize the impact of regulatory delays and mandates regarding tower installations.
Frost & Sullivan said the mobile broadband service requires huge investments in backbone, backhaul, and other network elements. Mobile operators need to maintain reasonable service quality and generate free cash flow, without excessively affecting network usage.