Latin America set for shakeup in plans

The nearing maturity of mobile voice services in most Latin American countries and the reduction on mobile termination rates set by regulators are leading to three main trends in the region: the launch of unlimited plans; the search for new revenue streams; and the commercial launch of multiple-play offerings.

Competition is likely to increase in all markets, not only due to the coverage overlap of large regional telecom groups with multiple-play offerings, however also due to the launch of new entrants and mobile virtual network operators, which are attracted with the favorable macroeconomic outlook in Latin America, and due to the influence of regulatory watchdogs, especially in Colombia, Mexico and Peru, which are the most concentrated markets.

The majority of Latin American countries

Even with some growth potential ahead in the majority of Latin American countries, the traditional voice market is likely to be threatened over the at once years. This includes push-to-talk over cellular networks, as so then as VoIP (Voice over Internet Protocol) applications with connectivity provided by data plans. These new solutions, which work over 3G and 4G networks, have a higher quality of service than previous solutions and are likely to become a substitute in a larger scale for mobile telephony.

Instant messaging, social networks and e-mail incorporated into mobile devices are as well a threat to text messaging, as they are an alternative for high prices charged.

Few MVNOs in commercial operations

Although there are currently only a few MVNOs in commercial operations, and most of them are owned by fixed operators, it is expected that new MVNO launches happen in Latin America due to a favorable scenario for mobile services and interest of different companies in this business. But, challenges related to the current market stage, high tax burden and interconnection rates and negotiation with mobile network operators need to be overcome by MVNO candidates.

Among the most promising mobile services hereafter, Internet access has a prominent position. Smart devices and data cards proliferation, along with affordable data plans for prepaid and postpaid users and a wider coverage of HSPA, HSPA+ and LTE (Long Term Evolution, latest standard in the mobile network technology) networks, are likely to drive the growth of Internet access in 2012, serving on occasion as a substitute for fixed broadband.

Mobile payment is another focus of mobile operators in the region. Examples are the partnership of Telefónica S.A. and MasterCard in 12 Latin American countries and TNL PSC S.A., Banco do Brasil and Cielo in Brazil. Other implementations expect to happen while 2012, using several solutions, just as SMS-based transactional payments, direct billing for postpaid users, online payments and nearly field communication.

The enterprise segment

For the enterprise segment, IT services are as well a trend, especially cloud computing, enterprise mobility solutions and mobile device management, which are likely to be adopted by corporations and small and medium enterprises.

Quadruple play is likely to appear in the Latin American countries, when fixed and mobile operators integrate their commercial offerings. An example of quadruple play is from Movistar in Venezuela, which offers fixed and mobile telephony, mobile broadband, and pay TV using direct-to-home innovation. Another example of a multiple-play package is with América Móvil in Brazil called "Combo Multi."

Several multiple-play offerings expect to occur while 2012, partly including Internet access through Wi-Fi hotspots. The deployment of Wi-Fi hotspots denotes a concern of mobile operators to offload data traffic from 3G networks. In Brazil, this strategy is being implemented by TIM, Oi and América Móvil, during Telefónica is currently focused on expanding its 3G network coverage.

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