LATIN AMERICA
AND THE
CARIBBEAN
ERICSSON MOBILITY REPORT
NOVEMBER 2015
Market Overview
Key figures: Latin America and the Caribbean
2015
2021
CAGR 2015–2021
Mobile subscriptions (million)
740
850
2%
Smartphone subscriptions (million)
370
640
10%
Data traffic per active smartphone (GB/month)
1.2
6
30%
Total mobile traffic (EB/month)
0.5
3.5
40%
Latin America has a mix of market maturity levels and user profiles when it comes to
information and communication technology (ICT). Mobile subscription penetration has
reached 115 percent, with most of its countries above 100 percent, however mobile
broadband still has a long way to go in order to reach the vast majority of the population
Mobile broadband subscriptions1, which are linked mainly
to smartphones, represent around 50 percent of total mobile
subscriptions in the region.
The increasing availability of lower-priced smartphones and
the need to remain constantly connected are rapidly boosting
the adoption of devices and services in the region. In 2015,
smartphones account for approximately 75 percent of the
region’s handset sales, compared to 65 percent last year.
Top five smartphone apps based
on Monthly Active Users (MAU)
Argentina
Brazil
Chile
Colombia
Mexico
Peru
1
WhatsApp
WhatsApp
WhatsApp
WhatsApp
WhatsApp
WhatsApp
2
YouTube
Chrome
YouTube
YouTube
YouTube
YouTube
3
Chrome
YouTube
Chrome
Chrome
Chrome
Chrome
4
Google Quick Search
Facebook
Facebook
Facebook
Facebook
Facebook
5
Google Maps
Gmail
Gmail
Gmail
Google Quick Search
Facebook Messenger
Source: Ericsson analysis on App Annie data of the top Android smartphone apps in each country, August 2015
Just as smartphones and the internet are changing the
way people around the world interact, the same tools are
transforming consumers’ daily routines. There has been a
rise in instant messaging, social networking, browsing, and
entertainment activities like music and video streaming. This
is reflected in the ranking of the 25 most popular apps per
country, based on monthly active users.
1
Mobile broadband is defined as CDMA2000 EV-DO, HSPA,
LTE, Mobile WiMAX and TD-SCDMA.
Among the top 25 apps there are local apps too. The most
popular local apps in Brazil and Colombia are related to
banking, while in Argentina they are related to online shopping.
As a consequence of the popularity of apps and online
services, data is rapidly gaining relevance as a revenue
stream. Operators have realized that new business models
for data monetization are imperative to surviving this
industry transformation. On average, data already represents
40 percent of operators’ total income in the region.
2 ERICSSON MOBILITY REPORT LATIN AMERICA AND THE CARIBBEAN NOVEMBER 2015
Consumer Trends
Latin Americans want to achieve a more connected life
by using multiple devices. Smartphones are already as popular
as PCs (laptops and desktops) for connecting to the internet
study 2015. This generates higher demands on connectivity,
as speed and coverage become even more relevant.
Smartphones show a high level of connectedness, and they
are the most popular device for internet access.2 89 percent
of smartphone users, compared to 76 percent of PC users,
go online daily.
Ownership is increasing rapidly, and smartphones will stand
out as the main internet-enabled device. They are at the top
of consumers’ shopping lists, with 36 percent intending to
buy one in the next 12 months.
Consumers use different types of connections, as shown in
the graphic below. In the pursuit of a better experience, they will
switch connections from Wi-Fi to mobile broadband and vice
versa. 54 percent of consumers switch to improve speed or
reliability of coverage, while only 24 percent switch due to cost.
On average, there are three connected devices per
household in Latin America and devices are selected
based on the activities users want to perform.
Smartphones are favored for messaging, social networking,
music and games. PCs are preferred for internet browsing,
watching video and online shopping.
Device users per connection type
Mobile broadband
61%
57%
Mobile phone
42%
Laptop/desktop
However, smartphones are gaining popularity as devices
for watching video. Over 70 percent of consumers are doing
so, according to the Ericsson ConsumerLab TV and media
81%
32%
Tablet
83%
Source: Ericsson ConsumerLab, Infocom 2014
Base: Users of internet on respective devices in Brazil,
Mexico, Argentina, Bolivia, El Salvador and Uruguay
Device ownership and connectedness
to the internet, Latin America
Device penetration
Wi-Fi
Device internet connectivity
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
Fixed line
phones
Smartphone
Basic
phone
Desktop
Laptop
Tablet
Portable
gaming device
Game
console
Portable MP3
device
Smart TV
Smartwatch
Note: Smartphones and mobile phones are presented at an individual level while the rest of the device ownership data is at a household level
Source: Ericsson ConsumerLab, Liberation from Location, regional report Latin America, 2014
Base: Based on 9,800 interviews conducted in Argentina, Bolivia, Brazil, Mexico, El Salvador and Uruguay
LATIN AMERICA AND THE CARIBBEAN NOVEMBER 2015 ERICSSON MOBILITY REPORT 3
Mobile subscriptions
Latin America will add 100 million new mobile subscriptions by 2021. At the end
of 2015, total mobile subscriptions will reach 740 million, which is approximately
10 percent of the global market. It will grow at a compound annual growth
rate (CAGR) of 2 percent reaching 850 million subscriptions in 2021
Mobile subscriptions per device, Latin America (million)
Mobile technologies are evolving rapidly
WCDMA/HSPA is expected to be the dominant technology
during this period, accounting for 50 percent of total
subscriptions by 2021. At the end of 2015, the number of
WCDMA/HSPA subscriptions will be slightly higher than
those for GSM/EDGE-only, having already surpassed them.
Almost 75 LTE networks have been launched, but it
accounts for only 5 percent of subscriptions. A strong
uptake of LTE in the coming years will lead to a 40 percent
share by 2021, with around 330 million subscriptions.
As users want faster speeds, new devices and mobile
applications, they are migrating to 3G and 4G. According
to an Ericsson ConsumerLab study 3, Latin American
2G users currently show an interest in upgrading to
3G (13 percent) and 4G (20 percent). Users with 3G
connections showed even more willingness to upgrade
to 4G (35 percent).
Smartphones
Mobile PCs, tablets, mobile routers
Basic phones
700
600
500
400
300
Mobile subscriptions by technology, Latin America (million)
LTE/5G
GSM/EDGE-only
WCDMA/HSPA
CDMA-only
Other
900
200
100
800
0
700
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
600
500
400
300
200
100
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2
Ericsson ConsumerLab Infocom study 2014. Based on 9,800 interviews
conducted in Argentina, Bolivia, Brazil, Mexico, El Salvador and Uruguay
Four out of five handsets will be smartphones by 2021
The proportion of smartphones in the total mobile phone
subscriptions base continues to grow. At the end of 2015,
more than 50 percent of handsets will be smartphones,
surpassing basic phones, and by 2021 it will rise to almost
80 percent.
The number of mobile PCs, tablets and mobile routers are
expected to increase by 60 percent in the forecasted period
but they will remain a small share of the subscriptions.
Even though consumers’ buying intention is to purchase2
PCs (27 percent) and tablets (18 percent) within a year,
many of them are used without a mobile subscription.
4 ERICSSON MOBILITY REPORT LATIN AMERICA AND THE CARIBBEAN NOVEMBER 2015
Mobile traffic
Voice traffic remains flat with a low impact on total mobile traffic volumes, but data is
expected to increase eight times by 2021. By 2021, 90 percent of traffic will come
from smartphones. The amount of mobile data used per active smartphone subscription
will rise, from an average of 1.2 GB per month in 2015 to 6 GB in 2021
Growing appetite for smartphone data services
Smartphones are being used for much more than
communication, such as entertainment activities like
watching videos and listening to music. According to the
Ericsson ConsumerLab TV and media study3, the number
of Latin Americans watching video on smartphones has
increased 130 percent between 2012 and 2015.
YouTube statistics show that globally, 40 percent of
viewing time watching videos its done on mobile devices.
Ericsson’s TV research shows that around 20 percent of
Latin Americans watch YouTube for over 3 hours a day,
and about 60 percent of all teenage viewing time is spent
on mobile devices (smartphone, tablet, laptop). This leads
to significant data consumption volumes. Improved speed
and capacity of mobile networks are important factors that
will support increasing demands.
8X
There will be eight times more mobile data traffic
between 2015 and 2021
Share of total TV time by age group, measured on respective devices
Tablet screen
100%
Smartphone screen
Smartphone, tablet,
and laptop
Laptop screen
Desktop screen
75%
TV screen
50%
TV screen
and desktop
25%
0%
16–19
20–24
25–34
35–44
45–59
Age
Source: Ericsson ConsumerLab, TV and media study 2015. Regional average of Brazil, Mexico and Colombia
3
Ericsson ConsumerLab, TV and media study, 2015. Based on 3,000 interviews conducted in Brazil, Mexico and Colombia
LATIN AMERICA AND THE CARIBBEAN NOVEMBER 2015 ERICSSON MOBILITY REPORT 5
App coverage
Data intensive apps, such as video streaming, place high demands
on the network and many consumers are building a perception of
network performance based on how well these apps perform
From a user perspective, app coverage is the
geographical area within which an app works as
the user expects.
For Brazilians, streaming video has double the impact
on perception of network quality than social networking.
However, the experience of network quality while watching
video has the lowest satisfaction rating among all the types
of apps included in the survey, according to an Ericsson
ConsumerLab study on app coverage.4
Effect of apps on network quality importance,
and network quality satisfaction level, Brazil
IMPORTANCE
Streaming video
Data-intensive applications like video calls and video
streaming, which require a throughput of 600 Kbps
(symmetrical) and 720 Kbps (downlink) respectively,
represent a challenge for operators in the region.
There is an evident need to expand LTE coverage and
increase spectrum allocation to boost speeds across
the region. LTE population coverage in Latin America
stands at about 30 percent and is estimated to reach
approximately 70 percent by 2021.
37%
Streaming music
Population coverage, Latin America
25%
~95%
Web browsing
22%
~90%
~90%
16%
37%
Web browsing
Social networking
49%
47%
Source: Ericsson ConsumerLab, Embracing data sharing, 2015
Base: City based sample of smartphone users in Brazil
2014
4
Ericsson ConsumerLab, Embracing Data Sharing, 2015.
6 ERICSSON MOBILITY REPORT LATIN AMERICA AND THE CARIBBEAN NOVEMBER 2015
2021
2014
2021
~30%
LTE
Streaming music
34%
GSM/EDGE
Streaming video
~70%
~70%
SATISFACTION
WCDMA/HSPA
Social networking
2X
In Brazil, video streaming is twice
as important as web browsing for
driving network quality perception
2014
2021
spectrum outlook
Latin American operators will take a number of different approaches in order to manage the
region’s increasing traffic demands while also providing an enhanced service experience
to consumers. They will increase site densification to improve coverage and capacity, as
well as evolving to provide more efficient technologies, like WCDMA/HSPA and LTE
Operators need a combination of spectrum bands
in high frequencies for improving capacity, such as
AWS Extension and 2.5 GHz bands, as well as low
frequencies for securing coverage, such as the
700 MHz band.
New spectrum bands need to be regionally and globally
harmonized to secure economies of scale, regional roaming
for easy cross-border coordination, and in order to benefit
from a whole new ecosystem of chipsets and devices.
According to recent ITU-R estimations, the region will
require a minimum of 1,340 MHz to support the increasing
mobile traffic demand by 2020 – about 730 MHz more on
top of the current average 610 MHz available in the region
today. Some markets still have the opportunity to license
frequencies in the short term, as they are not using all the
spectrum available in the region. Average licensed spectrum
is 360 MHz in the top 6 Latin American markets.
LTE carrier aggregation is rapidly emerging as a way to
achieve higher data throughputs by adding spectrum.
By 2020, additional spectrum will be required for
the introduction of 5G technologies, which will be an
efficient alternative for serving the emerging
machine-to-machine markets in industries such
as utilities, transportation and public safety.
Licensed spectrum per band, Latin America
4G
2G/3G
850 MHz
900 MHz
1800 MHz
1900 MHz
2100 MHz
Argentina
700 MHz
AWS
2.5 GHz
290 MHz
Brazil
501.5 MHz
Colombia
405 MHz
450 MHz
Chile
Mexico
226 MHz
360 MHz average
284 MHz
Peru
0
100
200
300
400
500
600
700
Amount of MHz available
Operators will continue acquiring licensed spectrum as the
preferred approach. However, they will also look into other
options such as leasing spectrum from other operators and
the gradual re-farming of existing 2G/3G bands into more
spectrum-efficient 4G technologies (for example 1800 MHz
and 1900 MHz band). These alternatives will depend on
operational aspects and the installed base of mobile devices.
Long-term, predictable mobile spectrum policies will
continue playing a vital role in boosting mobile service
innovation and ensuring private investments.
Points for governments to consider
> Accelerating the allocation and release of new
spectrum bands for 3G and 4G networks. Future LTE
capacity bands: AWS Extension, 3.5 GHz, 2.3 GHz
> Relaxing current spectrum caps
> Allowing for spectrum trading
> Applying a technology-neutral approach by allowing
re-farming to most recent technologies
> Providing new additional spectrum for the successful
introduction of 5G services beyond 2020
LATIN AMERICA AND THE CARIBBEAN NOVEMBER 2015 ERICSSON MOBILITY REPORT 7
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Ericsson has been present in Latin America since 1896, when the company
established an agreement in Colombia and delivered equipment for the first time in
the region. In the early 1900s, Ericsson increased its presence in Latin America by
signing commercial deals in Argentina, Brazil and Mexico. Today, Ericsson is present
in 56 countries within South America, Central America, Mexico and the Caribbean,
which combined count the region as one of the few with complete Ericsson
installations, including a production unit, R&D Center and training center. Ericsson
is the market leading telecom supplier, with over 40 percent market share in Latin
America and more than 100 telecom service contracts in the region.
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