Mobile operator Movistar Chile launched on Friday (Mar 30) a new package of three multimedia products.
The three services are: interactive TV, which allows users access to streaming of three national and five international TV channels; Video Play, a video sharing portal similar to YouTube; and Full Access, which allows surfing of the web via both a GPRS/EDGE network and the 350 Wi-Fi hotspots operated by fixed line sister company Telefónica Chile.
The Full Access plan means average access speeds of 512kbps for Wi-Fi and 100kbps for EDGE.
The launch comes at a time when value added services are proving crucial for mobile operators since in Chile there is not much room for attracting new subscribers and the majority of existing subscribers prefer the low-ARPU prepaid option.
Chile ended 2006 with mobile penetration of 83%, greater than mobile penetration in the US, according to Movistar Chile marketing director Paula Figueroa. Movistar Chile's general manager Oliver Flögel recently said he expects mobile penetration to surpass 90% by the end of year.
RISING DEMAND FOR VAS
Non-voice value added services (VAS), which include SMS, currently represent some 15-20% of Movistar's annual revenues but this figure is growing by 30% per year, Figueroa told BNamericas, speaking on the sidelines of the launch.
Around 60% of Movistar's customers own high-end phones compared to 40% a few years ago, which demonstrates an interest on the part of the consumer to have access to more advanced services, she added.
For the Video Play service, which Figueroa believes is the first mobile video community in Latin America, users would be charged per kilobyte, and she estimates that an average video could cost around 120 pesos (US$0.22) to download and 100 pesos to send.
The executive could not suggest an ideal ARPU figure for the new services and said the company had no plans in the medium term for removing handset subsidies.
The priorities are "to have relevant content, and secondly at a price that is accessible to most of the population," according to Figueroa. "Today the world is looking for content and obtaining it as fast as possible, always having it available," she added.
Camera functionalities are something that is now taken as a given part of a cell phone today by Chilean consumers while MP3 functionality is gaining in popularity. Bluetooth is still not that widespread.
3G, NOT YET
Figueroa said Telefónica Móviles was satisfied with the speed offered by its EDGE platform and was not in any rush to upgrade to 3G until there was a consolidated demand for value added products.
The options were either to have "3G for two or three municipalities or to have EDGE with 100% coverage. It seemed a logical first step for us to have 100% availability with a faster network than GPRS. It isn't 3G. The world is converging towards 3G and we will get there, but it seemed more logical for us to start with 100% coverage," Figueroa said.
Movistar closed 2006 with a total client base of 5.3mn, representing a 42.6% share of the market, Entel PCS ended the year in second place with 4.9mn users and a 39.1% market share, followed by Claro, the Chilean unit of Mexico's América Móvil, with 18.3%."
Posted to the site on 2nd April 2007
Posted to: www.cellular-news.com/story/22937.php