LATAM Telecom

Subscriber usage behavior clearly shows that the Latin American market is ready for a solution such as GSMA Personal IM, also known as SMS 2.0 (Telefonica Spain, Acision) or Instant SMS (Comverse). The chart above measures three elements: Data ARPU (x), mobile penetration (y) and average number of SMS messages per user per month for several Latin American countries (1) . The countries with SMS usage in the region are Venezuela, Argentina and Ecuador; with Colombia having the lowest SMS usage. These countries also have a higher data ARPU; this is not surprising as in Latin America 70% to 90% of data revenue comes from SMS. What's relevant here is subscriber SMS usage, surpassing 100 messages per user per month as in the case of Venezuela and more recently Argentina; this tells us that heavy users are actually having live conversations using SMS; in other words, a segment of subscribers uses SMS as Instant Messaging, with a higher number of messages going back and forth per conversa...

During the last quarter of 2008, as they finalized budgets and CAPEX allocation for the coming year, operators around the world were forced to take a second look at their growth expectations and make drastic changes to their 2009 plans. Operators are preparing to face the economic downturn with layoffs and by reducing CAPEX and OPEX and vendors are reacting to these measures and to the economic environment in a similar way. The question that needs to be asked, however, is how will operators and vendors rethink opportunities for 2009? The economic downturn will force operators to be even more cautious with service rollouts and new investments (see Millicom , Telefonica ). There is no question that their priorities this year will focus on: Improving productivity Reducing OPEX Rollout of new services with minimal CAPEX and faster ROI. These guidelines provide a framework for rethinking VAS strategies and opportunities for 2009: Increasing voice revenues - Even if the economic downturn af...

Voice Mail and SMS have been in a mature stage for several years now; growth in most markets has slowed down and until recently, they kept the same form and functionality they had since they were first introduced years ago. Both services, however, remain the bread and butter of VAS services. In most markets (the USA being a notable exception) Voice Mail is the largest VAS contributor to revenue for mobile operators; SMS in some cases accounts for up to 90% of data revenue. This alone justifies paying attention to recent developments that are breathing new life into these two services by dramatically improving the user experience with visual interfaces. The best example of this is the iPhone, which introduced to the market visual applications for both services. Visual Voice Mail had been around for several years, but it was not until the iPhone was introduced that it got the attention of mobile operators. While it can be argued that the iPhone reflects a shift in users’ expectations as ...

It appears that operators in Brazil are taking the lead now in deploying Personal Instant Messaging , following GSM Association's technical and commercial framework, which has already been deployed by other operators in Europe and Asia. The most interesting aspect of the efforts done by the largest operators in Brazil, including TIM, Oi, Claro and Vivo is adopting the framework proposed by GSMA, which allows interconnection. Other operators in Europe and Asia are already working with this framework, where interconnection is a key element. Even though operators in Brazil are still in initial stages, in discussions with different vendors, it appears that 2008 will be the year for Personal Instant Messaging in Latin America.

Given MSN's slow approach to developing the MIM market in Latin America, it will be interesting tosee if Telefonica's strategy of repackaging Personal IM as SMS 2.0 -like they are doing in Spain- will work in Latin America.It is no secret that operators in Latin America have triedfor several years to sign an agreement with MSN for Mobile Instant Messaging with no success. Until 2006, only Movistar Chile and Argentina were able to sign such an agreement and that was for a WAP based solution.GSMA is developing an open solution, with interconnection between operators . In Europe operators have already deployed such a solution, this seems like an appropriate strategy for the Latin American market.GSMA has also stated that it eventually wants to have interconnectivity with portals. This makes us wonder how long can MSN stand the pressure? With two huge groups, Telefonica and America Movil, dominating the landscape in one of the fastest growing mobile markets, it shouldn't be d...