Over the past couple of years, the market for mobile handsets in Latin America has grown
remarkably, driven by a healthy increase in mobilesubscribers as well as by a vibrant replacement
market. Device sales will increase further through 2012, with Brazil and Mexico the biggest
opportunities. This profound transformation will involve such factors as rising mobile penetration
rates, adoption of 3G, a growing replacement market and demand for music and camera features.
Over the past couple of years, the market for mobile handsets in Latin America has grown
remarkably, driven by a healthy increase in mobilesubscribers as well as by a vibrant replacement
market. Device sales will increase further through 2012, with Brazil and Mexico the biggest
opportunities. This profound transformation will involve such factors as rising mobile penetration
rates, adoption of 3G, a growing replacement market and demand for music and camera features.
Over the past couple of years, the market for mobile handsets in Latin America has grown
remarkably, driven by a healthy increase in mobilesubscribers as well as by a vibrant replacement
market. Device sales will increase further through 2012, with Brazil and Mexico the biggest
opportunities. This profound transformation will involve such factors as rising mobile penetration
rates, adoption of 3G, a growing replacement market and demand for music and camera features.
While every effort has been taken to verify the accuracy of this information, Pyramid Research cannot accept any responsibility or liability for reliance by any thi i f ti
R E S E A R C H R E P O R T
Handsets Get a Latin Beat
Mobile Users in Latin America Turn to Music, Cameras and 3G
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Report overview Handsets Get a Latin Beat: Mobile Users in Latin America Turn to Music, Cameras and 3G
Over the past couple of years, the market for mobile handsets in Latin America has grown remarkably, driven by a healthy increase in mobile subscribers as well as by a vibrant replacement market. Device sales will increase further through 2012, with Brazil and Mexico the biggest opportunities. This profound transformation will involve such factors as rising mobile penetration rates, adoption of 3G, a growing replacement market and demand for music and camera features.
Pyramid Research, in a Report titled Handsets Get a Latin Beat: Mobile Users in Latin America Turn to Music, Cameras and 3G, examines this transformation and what it means to both handset vendors and mobile operators. It looks at the underlying trends in the mobile market, including technology developments, mobile services demand, the competitive landscape, ARPS, the battle between the two largest mobile operators in the region, handset revenue and unit sales, ASPs, demographic factors and market shares. The Report examines both relevant moves by operators and the strategies of the major handset vendors in the market, including individual marketing campaigns and promotions.
Key findings of the Report include: Users are upgrading from voice-only phones to devices with music and camera capabilities. Wide-scale deployment of 3G in Latin America is creating numerous opportunities for handset manufacturers during the 2008-2012 period. Sony Ericsson and LG have expanded their market shares in the region thanks to their strong portfolios, effective marketing and above all their strategic alliances with mobile operators. Working more closely with each other, mobile operators are actively promoting music phones while vendors are launching new handsets with pre-loaded and exclusive content.
It not only looks at past and future developments in the overall regional market, but also examines in detail the seven largest country markets: Brazil, Mexico, Venezuela, Argentina, Colombia, Peru and Chile. For each market, the Report provides a handset market overview, technology trends, handset price and revenue trends, an ASP forecast, sales of handsets by type of buyer, an analysis of the competitive landscape, a discussion of key recent campaigns and much more.
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While every effort has been taken to verify the accuracy of this information, Pyramid Research cannot accept any responsibility or liability for reliance by any thi i f ti Key questions answered How strong will the demand drivers such as subscription and penetration growth be in Latin America through 2012? How will 3G migrations affect handset demand in various countries, and when? What role will mobile data uptake play? How will the battle between Amrica Mvil and Telefnica shape the regions markets? Can replacement sales keep the overall markets growing as subscriber growth slows? How are vendors positioning themselves in the smartphone market? Where is smartphone adoption strongest? Which handset vendors are making inroads in which markets, and why? How strong will adoption of cameras and music players be in various countries through 2012? How are operators marketing music phones most successfully? Will replacement sales make up for declining new-subscriber sales in all top seven countries? What will the handset ASP be in the largest markets in Latin America in 2012? Market revenue?
Target audience Mobile network operators Learn where the opportunities are, and how large they are in your markets. Evaluate the relative strengths of handset vendors and how they can best meet your needs. Gather insight into future developments through the Reports extensive forecasting of multiple metrics for each of the regions top seven countries. Benchmark handset sales against competitors or other markets. Evaluate marketing strategies and identify those that meet your needs.
Handset vendors and distributors Discover the markets where the opportunities match your strengths. Assess the strategies of your competitors and learn how best to respond. Evaluate operators on their requirements to form partnerships that build on what you can offer them.
Infrastructure equipment vendors Obtain data on past and future market trends for the seven largest markets in Latin America. Estimate adoption rates of new technologies and the level of infrastructure support required. Recognize the leading handset manufacturers in specific countries and the opportunities available to you.
Software and mobile content providers Find out how the telecom market is changing in one of the most exciting regions of the world, and locate opportunities for your content and applications. Learn what your existing and prospective clients whether handset manufacturers or operators are doing, anticipate their challenges and align your offerings with their strategies.
Investors and financial institutions Locate the markets where investment opportunities are greatest. Recognize the timeframes of technology changes that provide openings for new players to enter the market or for existing players to expand.
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While every effort has been taken to verify the accuracy of this information, Pyramid Research cannot accept any responsibility or liability for reliance by any thi i f ti Table of contents Executive summary Market context: mobile market trends Mobile services demand Technology trends Mobile ARPS and data revenue trends Mobile service competitive landscape Amrica Mvil Telefnica Latin America mobile handset market overview Latin America handset demand Top seven countries in the region Handset revenue, ASP and unit sales Technology trends Music trends Camera trends Smartphone trends Competitive analysis: handset vendors Market share evolution Nokia Motorola Sony Ericsson Samsung LG Others Overview of top seven markets Brazil Mexico Venezuela Argentina Colombia Peru Chile
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While every effort has been taken to verify the accuracy of this information, Pyramid Research cannot accept any responsibility or liability for reliance by any thi i f ti Table of exhibits Mobile subscriptions and penetration in Latin America, 2005-2012 Key market indicators, 2007A Mobile penetration by country, 2007 Total mobile subscribers 2007 Total mobile subscribers 2012 Mobile subscriptions in Latin America by technology family, 2003-2012 Countries in Latin America with 3G (UMTS-HSPA and CDMA EVDO) Total revenue, and data revenue as percentage of total revenue, 2005-2012 Mobile data revenue mix ARPS comparison by market (US$), 2007 Data ARPS as a percentage of total ARPS, 2007 Subscriber totals in Latin America by operator, 2002 Subscriber totals in Latin America by operator, 2007 Subscriber totals in Latin America by operator, 2012E Amrica Mvil: Key indicators Amrica Mvils market rank and market share at year-end 2007 Telefnica: Key indicators Telefnica Movistar market rank and market share at year-end 2007 Telefnica Mviles merged with Telefnica: New strategic model Sales of handsets to end users by category In Latin America, 2005, 2012 Largest handset markets in Latin America 2007 Total handset sales in Latin America, 2007 Total market ASP 2006-2012 Total market handset revenue 2006-2012 Total market ASP in top seven markets 2007 Total market handset revenue in top seven markets 2007 The size, growth and penetration of handset markets, 2007 (US$) New handset unit sales by technology group 2007 New handset unit sales by generation 2007 Music handsets sold; music as percentage of handsets sold in Latin America, 2007-2012 Music phones as percentage of handset sales in top seven markets, 2007 Camera phones sold; camera phones as percentage of handsets sold in Latin America Camera phones as percentage of total sales in top seven markets, 2007 Smartphones sold; percentage of handsets sold Smartphones as percentage of total handset sales, 2007 Positioning of smartphone players in Latin America Handset market share (sell-through), 2005-2009 Market share of top five vendors vs. others 2005-2009 Nokia's share of Latin American handset market, 2007 Nokia's market share in top seven markets, 2007 Global initiatives by Nokia Motorola's share of Latin American handset market, 2007 Motorola's market share in top seven markets, 2007 HANDSETS GET A LATIN BEAT REPORT EXCERPT
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While every effort has been taken to verify the accuracy of this information, Pyramid Research cannot accept any responsibility or liability for reliance by any thi i f ti Sony Ericsson's share of Latin American handset market, 2007 Sony Ericsson's market share in top seven markets, 2007 Samsung's share of Latin American handset market, 2007 Samsung's market share in top seven markets, 2007 LG's share of Latin American handset market, 2007 LG's market share in top seven markets, 2007 Campaign with Vivo to promote LG KM500 LG official sponsor of Sao Paulo football (soccer) team Others' share of Latin American handset market, 2007 Brazil: Sales of handsets to end users by category in Brazil, 2005-2012 New handset sales by technology group 2007: 44.0bn New handset sales by generation 2007 Total market ASP in Brazil, 2006-2012 Total market handset revenue in Brazil, 2006-2012 Market shares of leading handset vendors in Brazil (2005-2009) Market shares of mobile operators in Brazil, 2005-2009 Music phones sold; music phones as percentage of handsets sold Camera phones sold; camera phones as percentage of handsets sold Vivo campaign featuring LG KM500 Sony Ericsson K850 featured in Big Brother Brazil Mexico: Sales of handsets to end users by category in Mexico, 2005-2012 New handset sales by technology group 2007 New handset sales by generation 2007 Total market ASP in Mexico, 2006-2012 Total market handset revenue in Mexico, 2006-2012 Market shares of leading handset vendors in Mexico (2005-2009) Market shares of mobile operators in Mexico, 2005-2009 Music phones sold; music phones as percentage of handsets sold Camera phones sold; camera phones as percentage of handsets sold Mother's Day campaign; Telcel prepaid Amigo kit 2007 Mother's Day campaign; Telcel prepaid Amigo kit 2008 Mother's Day campaign; Telcel postpaid plans 2008 Venezuela: Sales of handsets to end users by category in Venezuela, 2005-2012 New handset sales by technology group 2007 New handset sales by generation 2007 Total market ASP in Venezuela, 2006-2012 Total market handset revenue in Venezuela, 2006-2012 Market shares of leading handset vendors in Venezuela, 2005-2009 Market shares of mobile operators in Venezuela, 2005-2009 Music phones sold; music phones as percentage of handsets sold Camera phones sold; camera phones as percentage of handsets sold Mother's Day campaign Movistar 2007 Mother's Day campaign Movistar 2008 HANDSETS GET A LATIN BEAT REPORT EXCERPT
2008 Pyramid Research, www.pyramidresearch.com
While every effort has been taken to verify the accuracy of this information, Pyramid Research cannot accept any responsibility or liability for reliance by any thi i f ti Argentina: Sales of handsets by category of end users in Argentina, 2005-2012 New handset sales by technology family 2007 New handset sales by generation 2007 Total market ASP in Argentina, 2005-2012 Total market handset revenue in Argentina, 2005-2012 Market shares of leading handset vendors in Argentina Market shares of mobile operators in Argentina, 2005-2009 Music phones sold; music phones as percentage of handsets sold Camera phones sold; camera phones as percentage of handsets sold Personal's campaign offering free songs with selected devices from Motorola Colombia: Sales of handsets to end users by category in Colombia, 2005-2012 New handset sales by technology croup 2007 New handset sales by generation: 2007 Total market ASP in Colombia, 2006-2012 Total market handset revenue in Colombia, 2006-2012 Market shares of leading handset vendors in Colombia, 2005-2009 Market shares of mobile operators in Colombia, 2005-2009 Music phones sold; music phones as percentage of handsets sold Camera phones sold; camera phones as percentage of handsets sold Tour Viajero 2008 Movistar and Motorola partnership Peru: Sales of handsets to end users by category in Peru, 2005, 2012 New handset sales by technology group 2007 New handset sales by generation 2007 Total market ASP in Peru, 2006-2012 Total market handset revenue in Peru, 2006-2012 Market shares of leading handset vendors in Peru, 2005-2009 Market shares of mobile operators in Peru, 2005-2009 Music phones sold; music phones as percentage of handsets sold Camera phones sold; camera phones as percentage of handsets sold Movistar in Peru targets the young Chile: Sales of handsets to end users by category in Chile, 2005-2012 New handset sales by technology group 2007 New handset sales by generation 2007 Total market ASP in Chile, 2005-2012 Total market handset revenue in Chile, 2005-2012 Market shares of leading handset vendors in Chile, 2005-2009 Market shares of mobile operators in Chile, 2005-2009 Music phones sold; music phones as percentage of handsets sold Camera phones sold; camera phones as percentage of handsets sold Movistar Chile: BlackBerry handsets capable of surfing to Facebook
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While every effort has been taken to verify the accuracy of this information, Pyramid Research cannot accept any responsibility or liability for reliance by any thi i f ti Companies mentioned in this Report
Alcatel (TCT Mobile) Alegro Amrica Mvil Ancel Apple AT&T Audiovox Avantel BellSouth BenQ Brasil Telecom Cantv Centennial Communications Claro Comcel CTI Digicel Digitel Disney Entel PCS Facebook Haier Telecom Haitel Hewlett-Packard HTC Huawei Iusacell Kyocera LG Microsoft Millicom Motorola Movilnet
Movistar Nextel (NII Holdings) NII Holdings (Nextel) Ningbo Bird Nokia Oi Orange Palm Panasonic Pantech Porta Research in Motion (BlackBerry) Sagem Samsung Sanyo Skyzen Sony Sony Ericsson Sprint TCT Mobile (Alcatel) Telcel Telecom Italia (TIM) Telecom Personal Telecom Venezuela Telefnica TIM (Telecom Italia) Trilogy International Partners UTStarcom Verizon Communications Viva Vivo Zonda ZTE
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About the authors
Omar Salvador, Senior Analyst
Based in Cambridge, Massachusetts, Omar Salvador is a Senior Analyst in the research team of Pyramid Research. Omar tracks and analyzes market developments and company strategies in the fixed and mobile communications markets in Latin America, with an emphasis on the Andean region and Central America. A key area of focus is mobile devices. Omar works on Latin America Market Perspectives, Forecasts, Reports and consulting projects. He has been quoted by publications such as The New York Times, Business Week, Bloomberg, Dow Jones, AmricaEconoma and BN Americas. He frequently appears in the industry press and has been interviewed on CNN en Espaol.
Prior to joining Pyramid, Omar worked for Institutional Shareholder Services as a global research analyst focusing on Spain and Latin America, producing analysis for a client base of institutional investors on a variety of proxy voting issues such as mergers and acquisitions, debt issuances and capital structure. Prior to this, Omar worked in marketing and sales in the consumer products industry for brands such as Colgate-Palmolive in Bolivia.
Omar is a graduate of Johns Hopkins University, where he earned his Master of Business Administration degree with a concentration in International Business. He holds a Bachelor in Business Administration from Santa Cruz Private University (UPSA) and a one-year diploma in Business Administration from Georgetown University. Omar is fluent in English and Spanish.
Leslie Arathoon, Vice President of Research
Leslie Arathoon is Vice President of Research for Pyramid Research, responsible for managing the companys entire portfolio of research, advisory and consulting services. Prior to assuming her current role, Leslie was Director of Product Strategy for Pyramid Research and Director of Latin America. Pyramids Researchs Advisory Services provide detailed coverage and analysis of the communications, media and technology industries in 90-plus countries worldwide. She is based in the companys headquarters in Cambridge, Massachusetts.
Leslie has developed forecasting models to support Pyramids core advisory services, including Pyramid Researchs mobile data and mobile operator KPI forecasting models, its fixed communications forecasting model, its fixed operator market share model and its handset sell- through forecasting model.
In her 10-year tenure at Pyramid Research, Leslie has worked on a wide variety of consulting projects, ranging from market sizing and market segmentation to market entry strategies and new product positioning, as well as valuations, due diligence and partner identification projects.
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While every effort has been taken to verify the accuracy of this information, Pyramid Research cannot accept any responsibility or liability for reliance by any thi i f ti
HANDSETS GET A LATIN BEAT REPORT EXCERPT
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While every effort has been taken to verify the accuracy of this information, Pyramid Research cannot accept any responsibility or liability for reliance by any thi i f ti Recent Research and Analysis from Pyramid Research
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The Excel output includes five years of historical data and five years of market projections for metrics such as penetration, mobile subscriptions (by type of package, by operator or MVNO and by network technology), users of specific data services (SMS, music, etc.), MOU, ARPS (by operator, by subscription type, by service, by application) and revenue. The Forecasts are based on extensive field research and use continually consistent methodology, aiming to capture the total spending on mobile data services in each market. IMS Market Opportunities: From Standardization to Implementation Research Report published April 2008 With network usage transforming the market, service providers are in a bind, and a new service delivery architecture, IMS, has been touted as their solution. But there is plenty of controversy about the fundamental issues surrounding IMS. 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With few markets left for expansion in the region and with organic growth slowing, America Mvil and Telefnica are now shifting their attention to 3G services and applications in their battle for the regions number one position. This Perspective examines the sizable opportunity created for handset vendors. Social Networking Goes Mobile Research Report published February 2008 Social networking services like MySpace and Facebook have emerged as some of the hottest Internet names, with daily news of partnerships, advertising initiatives and acquisitions. This report looks at the SNS business model and analyzes its future, forecasting the number of social networking members globally by 2012. It also assesses the future of mobile social networking and the rationale for SNSs and mobile operators to collaborate, including the revenue mobile operators stand to gain. Finally, the report profiles some of the top players in the mobile social networking world.
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About Pyramid Research Growth experts at the intersection of emerging markets and converging technologies Leaders of the digital revolution depend on Pyramid Research to develop winning strategies and dynamic business models in the converging global communications markets. We advise decision-makers in the operator, vendor, regulator, consulting and financial service communities on how to anticipate market trends, attack new segments, respond to competitive threats, benchmark performance and capitalize on opportunities. More than 20 years of unmatched global perspective Pyramid Research uses a unique, structured, bottom-up methodology to forecast demand. Unlike our competitors, which provide general global answers by indexing data from a few select markets, we fully segment and analyze the competitive landscapes of nearly 100 countries and consistently aggregate data to build our local, regional and global forecasts. We conduct our own primary research in every country and develop scenarios for growth across technologies by assessing existing and emerging business models. This methodology and intelligence are the foundations for our industry-renowned forecasts, which are the most comprehensive demand, growth and market share tracking services available in the industry today. This unparalleled quantitative foundation assures clients that advice from Pyramid Research is reliable, relevant and actionable.
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