Telecoms in Latin America to invest $193 bn for Capex in 7 years

Telecom operators in Latin America will invest $193 billion towards Capex (capital spending) over the next seven-year period (2014 to 2020), said GSMA.

The main focus will be mobile broadband including 3G and 4G networks.

Latin American telecoms’ Capex over the last six years (2008 to 2013) was more than $96 billion.

2G share in the telecom market in Latin America will decrease to 20 percent of the expected 956 million connections by 2020 from 60 percent of 718 million due to shift to mobile broadband, said GSMA.

Anne Bouverot, director general of GSMA, said: “The adoption of smartphones – alongside expanding mobile broadband coverage – is unlocking new business opportunities for all players within the mobile value chain, as well as enabling millions of people to connect to the mobile internet.”

3G accounted for 39 percent of connections at the end of September 2014, higher than the global average of 32 percent. 4G will grow rapidly from one percent currently.

Latin America telecom

Smartphones accounted for 30 percent of connections (200 million) and will make up 70 percent of 605 million by 2020. Latin American telecom market will have the second-highest installed base of smartphones in the world, behind Asia Pacific.

The Latin America mobile market is now the fourth-largest globally, with almost 326 million unique mobile subscribers. Unique subscriber penetration will grow from 52 percent to 60 percent by 2020, said GSMA.

Brazil is accounting for a third (114 million) of the region’s unique mobile subscriber base. Brazil, Mexico, Argentina, Colombia and Venezuela are the five largest markets in the region. These countries together account for 70 percent (230 million). Subscriber penetration rates in the major markets in Latin America range from a low of 37 percent in Mexico to a high of 77 percent in Costa Rica.

According to the report, there were 16 million cellular M2M connections in Latin America at the end of September 2014, a figure that is expected to grow by 25 per cent a year (CAGR) in the period to 2020, reaching 66 million by that point.

Cisco says mobile data traffic in Latin America will grow 66 percent per year (CAGR) over the next few years, from 91,863 terabytes per month in 2013 to 1,158,090 terabytes per month in 2018, well ahead of the growth forecast for more developed markets such as Europe and North America.

In 2013, the mobile industry contributed 4.1 percent to total regional Gross Domestic Product (GDP), equivalent to $242 billion. By 2020, contribution from mobile ecosystem will grow to $275 billion, representing 4.5 percent of projected regional GDP.

Pix source: millicom

Baburajan K
[email protected]