Quovis Media Wrap Up was off last week because our team members were in Rio de Janeiro, not enjoying Ipanema beach but attending Informa´s LTE Latin America 2010. During the event operators from Chile, Argentina and Brazil explained how the technology will fit into their future business roadmap. LTE is seen by the operators as a capacity enabler more than a technology that would allow for faster speeds. Spectrum is the key issue surrounding the discussion in Latin America where spectrum harmonization with the rest of the world outside the 2,5 GHz will be very difficult or even impossible.
IP Multimedia Subsystem (IMS) will become an important component once operators consider voice as an integral component of LTE deployments. At this point, however, operators are not considering launching voice services over LTE once they launch their networks and intermediate solutions like CSFB will probably be deployed.
Other Latin American story Chilean operator Entel announcement last week its plans to invest US$580 million this year. The investment will be mainly for the infrastructure expansion of its mobile arm. According to Juan Hurtado Vicuna, president of Entel, the amount represents an increase of US$110 million compared to 2009. The executive said that from the total, US$256 million would be allocated to mobile infrastructure and US$162.6 million for the purchase of handsets. The fixed network will absorb US$156.1 million.
ISDB-T is consolidating itself as the digital TV standard. Costa Rican Joint Special Committee Digital Television delivered its recommendation to the executive recommending the adoption of the Japanese-Brazilian standard, ISDB-T, after comparing it with the ATSC and DVB standards. The experts stressed the interactivity and spectral efficiency of ISDB-T versus the other two options.
At the same time and in the same country, Costa Rican Electricity Institute (ICE), the incumbent fixed and mobile operator, asked the Government to reconsider the terms of Executive Order number 35866 of the Ministry of Environment, Energy & Telecommunications (MINAET) amending the National Plan for Frequency Allocation (PNAF). ICE requested the establishment of an inter-agency technical group to assess what frequencies can be effectively reused. The company argued that the current terms of the decree are harmful to its interests and those from the consumers, while it will negatively impact fixed, mobile, long distance, data and Internet quality of service.
Moving south to Brazil, Luiz Eduardo Baptista, president of Sky, ironically or seriously, we still have not figure that one out, said that with US$8,420 million would be able to cover the entire country with wireless broadband. There are rumors that Oi could have asked to receive government funds for that amount to take broadband anywhere. Oi denied having asked for public funds to invest in broadband infrastructure.
Two years ago, Sky bought a company called Itsa, a MMDS pay TV operator with operations in 12 cities. The company intended to use Itsa´s spectrum to deploy a WiMAX network, but was prevented from doing so because of the regulator Agência Nacional de Telecomunicações (Anatel). Baptista said that if Sky were allowed to deploy a WiMAX network competition would push broadband prices down in the country.
Still in Brazil, Minister of Justice has finished a bill that would prohibit mobile operators to cancel unspent prepaid balances. Before summiting the law, the government wants to negotiate with mobile operators to see if they are willing to impose that measure without having to take the bill through Congress.
Federico Baumgartner, Mexican manager for the Latin American Council of Pay TV Advertising (Lamac), said that during 2010 pay television services will add one million new subscribers in the country, representing and increase of 10 and 15% compared to December 2009. The estimate, however, ignores the impact of possible new entrants in the market, which could stimulate further growth. According to Baumgartner, if Telmex finally enters the paid TV market, service penetration, which in 2009 reached 33,9% of Mexican households, could soar to 45 or 50% of households in the country.
Moreover, Telmex reported US$378 million net income during the period from January to March 2010 and 2,1% decrease in profits compared to the first quarter of 2009. Revenue, meanwhile, fell by 4,8% year on year, reaching US$2,300 million. In March, Telmex reported 15.8 million lines, a reduction of 1.7 million lines compared to March 2009. On the other hand, Telmex currently has 6.8 million broadband customers. During the first quarter, the company added 247,000 subscribers to this service.
Lucila Carmen Osorno, president of DirecTV Colombia, said the company exceeded the figure of 300,000 customers in the country, which implies that the operator has added 50,000 new subscribers so far this year. The executive added that 80% of new clients have contracted services such as DirecTV Plus HD or DirecTV. DirecTV Colombia accounts for 30% of the DirectTV US regional business.
And the Ministry of Information Technologies and Communications (Mintic) in Colombia still reported that the deadline for filing the bid for the 2.5GHz band would be extended until next May 7th, 2010. According to the Mintic, this decision was made based on suggestions raised at the public hearing made last April 7th , 2010.
The Superintendency of Industry and Commerce (SIC) reported that in Colombia there are 42.2 million active mobile lines registered as of March. During the first quarter of 2010, operators added 201,626 new users, representing an increase of 0.48% over the fourth quarter of 2009. Comcel (America Movil), with 28.6 million customers, is the market leader with 67.9% share. Secondly, with 9.3 million lines represent 22% of the market, it is Movistar. And finally, Tigo (Millicom, ETB and EPM Une), with its 4.2 million customers, achieved a 9.9% share of the market.
Through Decree No. 7387, published last week in the Official Gazette, the Venezuelan government created the Venezuelan Telecommunications Industry (Invetel). Under the Ministry of Popular Power for Science, Technology and Industry Intermediate (MCTI), Invetel will develop, manufacture, market and test various prototypes of antennas, low noise amplifiers and other components for the telecommunications and IT industries.
And finally, Movistar seeks to strengthen its ecosystem of application developers. The operator introduced in Argentina the Movistar Developers Platform, a global initiative to boost the ecosystem of mobile application developers. The project, which replicates the ones Movistar already has in the United Kingdon, Spain and Mexico, aims to provide monetization and marketing mechanisms for application developers as well as offer to them resources such as the APIs.
We apologize for the delay in getting our Wrap Up this week, and we are open to anyone who wants to know in more detail what happened last week at LTE Latin America 2010.
Quovis Media Team