Telecom Trends for 2013: Lower Prices, Higher Speeds

01/02/2013

Special contribution by Juan Jung*

In recent years, the major regional telecommunications-related variables have exhibited significant positive trends from the users’ point of view, which has resulted in a positive outlook for 2013.

By way of example, regional mobile penetration is approximately 110%. Latin America is expected to close 2013 with approximately 726 million mobile lines, which represents a 6% increase as compared to 2012. Mobile broadband is also growing rapidly and becoming the primary choice for Internet access in the region –mobile broadband subscriptions have seen an annual increase of 127% and are expected to continue to grow. Finally, smartphone penetration (LTE) is expected to breach the gap with global averages[1] by 2013.

Backed by various digital expansion plans implemented throughout the region, fixed broadband connectivity services continue to grow at a good rate. Trends are not only favorable in terms of connectivity, but also in terms of other aspects related to accessibility and user satisfaction: price and quality.

As regards accessibility, the average cost of the cheapest fixed broadband service in Latin America has experienced a 25% decrease between 2010 and 2012, whereas the average cost among OECD countries has experienced a similar increase. There are several cases, such as, among others, Venezuela, Uruguay, Mexico, Brazil, Costa Rica and Chile, where the cost of the cheapest broadband service is lower than the average cost of the cheapest service in the OECD countries (USD PPP)[2].

As for the quality of the service, the speed of broadband services has also seen an increase in the region. A particularly remarkable case is that of Chile, where the average connection speed is six Mbps, then followed by Colombia.

In 2013, the role of governments and telecom operators will be key for these developments.  In the case of the authorities, by promoting public policies and implementing digital expansion plans aimed at providing widespread Internet access and developing the digital ecosystem; in the case of companies, by investing in infrastructure and coverage and creating applications that are relevant to the community.

*Juan Jung was born 30 years ago in Montevideo, Uruguay. He has been Regulatory Analysis and Studies Coordinator at AHCIET’s Montevideo Office since 2012.  He holds a degree in Economy from Universidad de la Republica (Uruguay) and an MBA from Universidad de Barcelona (Spain). He is currently enrolled in the PhD program at Universidad de Barcelona.

[1]Source: GSMA
[2]Source: Galperín (2012)