By Phil Anderson, Telecom Sector Analyst, Business News Americas
The Latin American mobile market is well-known for its dependence on prepaid users. They comprise some 80% of the region’s mobile accounts—leading to a perception that operators are somewhat dependent on voice and SMS services.
According to industry group 4G Americas, the region ended September 2010 with some 31 million HSPA accounts out of 547 million mobile accounts overall. This means only 6% of all mobile accounts encompass the full range of new service options. However, by deploying 3G networks the mobile operators are now the prime candidates for solving the region’s digital divide issues, not only by bringing broadband to neglected areas, but also offering a price advantage compared to fixed broadband since the deployment costs are lower. Broadband penetration averages around 7% in this region, with Chile, Argentina, Mexico and Uruguay all sharing the lead at around 10%.
Fast growth for mobile broadband
Across the board, Latin American operators describe mobile broadband as their fastest growing business line. 4G Americas also recently reported that 36% of all wireless subscriptions signed in Latin America during the third quarter of 2010 were based on HSPA technology.
In the most densely populated parts of this region, HSPA networks have sufficient coverage to at least operate as an alternative to fixed broadband. While mobile 3G users do have to revert to 2.5G in many of the areas they might travel to, for home and office use they are not going to find 3G lacking. There are at least two carriers, Entel in Chile and Iusacell in Mexico, that have already deployed HSPA+ networks in key areas.
With the infrastructure in place, the focus turns to ensuring the customer experience
With the infrastructure in place, it is feasible for operators to focus on selling 3G services in the areas where it is available rather than on ramping up coverage, although this latter point is certainly still a high priority. This means that now is the time for service providers to invest in solutions that help ensure a quality experience when customers try these new services and the applications that depend on them.
Mobile broadband is already sufficiently popular in enough areas for service quality to be a focus. For example, in Brazil, HSPA devices exceeded fixed broadband accounts in April, and with the great variety of payment options available for intermittent access many believe that it is fair to equate ownership of such devices with subscription to a mobile broadband account. Following that logic, research organizations expect the country to end 2010 with up to 26 million mobile broadband accounts against 13 million fixed broadband accounts. Those 26 million mobile accounts will be mostly handset-based, with USB laptop modems accounting for 6 million. But either way, mobile operators will have to manage those accounts with an enhanced emphasis on service quality since they are now competing with fixed line broadband as well as each other.
Mobile broadband dictates the availability of more complex services and applications, providing the perfect opportunity for carriers to differentiate themselves from each other. However, innovative offerings are only going to capture the consumer’s attention if they work perfectly. There’s a great deal riding on data services, which makes this an area of importance when it comes to quality assurance solutions.
Quality assurance is critical to support growth in SMS traffic as well
Application developers are well aware that the great majority of Latin American mobile users do not have the broadband option and are focused on producing apps that can operate over the SMS platform. Therefore, operators require the same quality assurance tools to support the likely growth in SMS traffic—not just from the end-user’s point of view, but also for the institution that will use SMS as the vehicle for its service, which at this point will most likely be advertising firms, banks, or content providers.
So there are plenty of opportunities for mobile operators to benefit from InfoVista’s assurance solutions as their services evolve, but why look only to the future when evaluating the need for quality assurance? Operators can use these tools today across the entire spectrum of operations.
These opportunities are addressed in InfoVista’s recently launched e-Book on end-to-end mobile service quality. It details the potential for control and improvement from the data center through the mobile packet core and the voice core, across the backhaul infrastructure and the radio access network and finally within end-user services and applications. By implementing InfoVista’s powerful end-to-end service assurance solutions, mobile operators in Latin America will be prepared to take full advantage of their promising market opportunities.
Originally from the UK, Phil moved to Chile in 1997 and joined Business News Americas as a journalist in 1999. In 2004 he took the reins as editor of the Telecom and IT news section, and in 2007 broke away from the press room to focus on in-depth reports, the Telecom Intelligence Series. Now as the New Content team’s telecoms sector analyst he also advises on production of the unit’s quarterly Telecoms Stats reports.
Phil has a degree in animal and plant biology from Sheffield University in the UK, and it was his interest in flora and fauna that originally attracted him to Latin America. As is the case for many foreigners in this region, English teaching was the initial means of settling into the local culture.
This is the first of a six-part guest blog on trends in the Latin American Market which includes contributions from BN Americas. We look forward to your comments.
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