LatAm mobile market: Subscribers up, revenue down

Latin Americans continued to embrace mobile phone service in 2002, as the number of subscribers in the region grew at a healthy pace, but revenue fell primarily due to currency devaluations, according to an IDC study.

Latin America closed 2002 with about 98 million mobile subscribers, 17 per cent more than in 2001. The number of Latin Americans carrying mobile phones rose primarily because the traditional landline phone service continues to be poor and because of the wide availability of prepaid calling plans, according to IDC’s “Latin America Wireless and Mobile Communications 2003” study, whose results were announced Wednesday.

Revenue, however, fell 14 per cent to US$19.6 billion in 2002, compared with 2001, due to steep and sudden currency devaluations in countries such as Brazil and Argentina.

Average monthly revenue per user (ARPU) fell even more, by 37 per cent to US$16.50, IDC said. In addition to currency devaluations, ARPU was affected by steep competition, which drives down prices, and by the high number of prepaid subscribers, who have less disposable income and less need for more sophisticated and profitable services such as data transmission and Internet access, according to IDC. Operators must shift their focus from grabbing subscribers in volume to attracting clients who are able to spend more, IDC said.

IDC expects subscribers to grow at a compound annual rate of about eight per cent between 2003 and 2007, reaching 145 million subscribers by 2007. Revenue is also expected to grow at an eight per cent compound annual rate, so that 2007 revenues should be US$29 billion, IDC said. Meanwhile, ARPU is expected to decline again in 2003 and then stabilize in 2004, growing at a compound annual rate of less than one per cent between 2003 and 2007.

Would you recommend this article?


Thanks for taking the time to let us know what you think of this article!
We'd love to hear your opinion about this or any other story you read in our publication.

Jim Love, Chief Content Officer, IT World Canada

Featured Download

Featured Articles

Cybersecurity in 2024: Priorities and challenges for Canadian organizations 

By Derek Manky As predictions for 2024 point to the continued expansion...

Survey shows generative AI is a top priority for Canadian corporate leaders.

Leaders are devoting significant budget to generative AI for 2024 Canadian corporate...

Related Tech News

Tech Jobs

Our experienced team of journalists and bloggers bring you engaging in-depth interviews, videos and content targeted to IT professionals and line-of-business executives.

Tech Companies Hiring Right Now