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Broadband is the Key to Guatemala's Telecom Growth

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The Guatemalan telecom market is expected to reach $2.8 billion by 2015 growing at a CAGR of 4.8 percent. The drivers behind this rapid expansion will be a 16 point advance in mobile penetration, as well as increases in data services and growth in pay TV household penetration, according to a new report from Pyramid Research.

Guatemala is the largest market in Central America, and competition in the mobile segment has caused voice tariffs to drop to regional lows. "Despite this competitive scenario, Pyramid sees interesting opportunities in mobile data services where messaging, mobile Internet, and mobile broadband could close the gap in communications that fixed services could not," says Jose Magana, Analyst at Pyramid. Mobile data revenue will expand at a CAGR of 11.8 percent over the next five years. Though messaging will remain the main source of revenue, connectivity will go from 6 percent to 28 percent in total revenues between 2010 and 2015. Also, mobile services, such as mobile banking and mobile advertising, could find fertile ground in Guatemala.

In the fixed segment, the market remains largely underpenetrated, and fixed broadband for the mass market has a chance to succeed. Also, initiatives, such as prepaid TV, prepaid broadband, and equipment bundling, are the right types of offerings for a market with this GDP per capita, notes Magana.

In order to keep up with the changing landscape, regional operator Claro has launched quadruple-play services to take advantage of the low penetration levels in broadband and pay-TV. "Guatemala has witnessed important convergence moves, like bundled services offered by operators, as Claro and its Turbonett service attempt to become the first quadruple-play operator in the country," indicates Mercado. "Pyramid expects both fixed-mobile convergence and triple-play bundles to have a significant impact in the foreseeable future," he adds.

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Tags: telecom  cagr  Guatemala