Latin American mobile group América Móvil expects mobile telephony penetration in Latin America to reach 65%-70% over the next few years, driven by better handsets at lower prices, the company's CEO Daniel Hajj told an investors conference call on Tuesday.
Hajj predicted that Colombia, where penetration is currently at 55%, will be one of the first countries to reach that level.
América Móvil's Comcel unit in Colombia is one of the group's fastest growing operations, posting a 249% spurt in operating profit to 147bn pesos (US$61.7mn) in the first quarter and a 61% boost in revenues to 1.037tn pesos.
Hajj clarified he is not sure how long it would take to reach 70% penetration as it would depend on market conditions.
"I don't know if it will take two years, three years or a year and a half, it depends a lot on the market but we're going to see 70% penetration in the future," Hajj said.
Hajj said he saw penetration being driven by better quality handsets designed for the medium-income market. AMX saw a substantial growth in sales of handsets with EDGE high-speed data functionality in the first quarter, he added.
"Medium handsets have increasingly more value added services with more ringtones and camera [functionality]. People are starting to buy more medium segment phones than higher segment phones and that is shown in a reduction in the average price of handsets. You're going to see better handsets at lower prices this year," Hajj said
América Móvil reported late Tuesday it had seen net profits of 9.95bn Mexican pesos (US$902mn) compared to 4.65bn pesos in 1Q05.
BNamericas.com"
Posted to the site on 4th May 2006
Posted to: www.cellular-news.com/story/17250.php