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El Salvador: Increased Mobile Data Usage Supported by 4G Rollouts and Expansion to Boost Telecom Growth

El Salvador: Increased Mobile Data Usage Supported by 4G Rollouts and Expansion to Boost Telecom Growth

Summary

In 2016, El Salvador generated telecom service revenue of US$1.2bn (equivalent to 4.4% of nominal GDP), a decline of 1.3% over 2015, due to a drop in fixed and mobile voice revenue. The mobile segment continued to be the largest contributor to overall telecom market revenue, accounting for 68.1% of total telecom revenue in 2016, owing to growth in mobile data revenue.

It is expected that overall telecom service revenue to grow at a CAGR of 2.2% during 2016-2021. Growth will be driven by data services, mainly mobile data revenue, owing to increasing adoption of mobile broadband services aided by operators’ 4G network expansion and consumption of data-centric services. The fixed/mobile revenue split will be dominated by the mobile segment during 2016-2021, with the fixed segment’s share of overall revenue to increase by 0.3 percentage points during 2016-2021, due to rising fixed Internet broadband revenue.

The top two operators, Tigo El Salvador and Claro El Salvador, which provide fixed, mobile and pay-TV services, accounted for 68.6% of total service revenue in 2016. Tigo El Salvador will continue in its leadership position through 2021. Operators are focusing investments on 4G network launch, network extension and appealing mobile data packages and value-added service offerings to drive revenue.

With 53.2% of all subscriptions, 2G technology held the largest share of the market in El Salvador in 2016. However, its share will decline owing to adoption of 3G and 4G services and operators’ focus on offering affordable data plans and smartphone devices. Going forward, we estimate the share of 3G subscriptions to increase to 61.5% of the total subscription base by year-end 2021. 4G subscriptions will reach 2.3m by year-end 2021, or 27.3% of total mobile subscriptions in El Salvador. Operator focus on LTE network investment and expansion along with the growing demand for faster data services will boost LTE uptake.

Broadband lines will grow at a CAGR of 7.8% during 2016-2021, with penetration of population to increase from 6.4% in 2016 to 9.0% by 2021. Growth will be driven by government initiatives, such as “Connectivity Component” and “Digital Agenda for Good Living,” and operators’ double-and triple-play services to improve broadband adoption.

The report El Salvador: Increased Mobile Data Usage Supported by 4G Rollouts and Expansion to Boost Telecom Growth, provides an executive-level overview of the telecommunications market in El Salvador today, with detailed forecasts of key indicators up to 2021. The report provides detailed analysis of the near-term opportunities, competitive dynamics and evolution of demand by service type and technology/platform across the fixed telephony, broadband, mobile and pay-TV sectors, as well as a review of key regulatory trends.

Moreover, this report provides in-depth analysis of the following -

  • Regional Context: Telecom market size and trends in El Salvador compared with other countries in the region.
  • The regulatory environment and trends: A review of the regulatory setting and agenda for the next 18-24 months as well as relevant developments pertaining to spectrum licensing, national broadband plans, number portability and more.
  • A demand profile: Analysis as well as historical figures and forecasts of service revenue from the fixed telephony (including VoIP), broadband, mobile voice, mobile data and pay-TV markets.
  • Service Evolution: A look at changes in the breakdown of overall revenue between the fixed/pay-TV and mobile sectors and between voice, data and video from 2016 to 2021.
  • The competitive landscape: An examination of key trends in competition and in the performance, revenue market shares and expected moves of service providers over the next 18-24 months.
  • In-depth sector analysis of fixed telephony, broadband, mobile voice, mobile data and pay-TV services: A quantitative analysis of service adoption trends by network technology and by operator, as well as of average revenue per line/subscription and service revenue through the end of the forecast period.
Companies mentioned in this report: Movistar, Claro, Tigo, Digicel, RED and Sky.

Scope
  • The overall telecom service revenue in El Salvador will grow at a CAGR of 2.2% during 2016-2021.
  • Voice revenue's contribution will decline over the 2016-2021 forecast period owing to data substitution. Data revenue's share will increase driven by 4G network expansion and attractive data bundled packages offered by operators.
  • Fixed broadband growth will be driven by government initiatives, such as Connectivity Component and Digital Agenda for Good Living“ and by operators' double- and triple-play services to improve broadband adoption.
Reasons to buy
  • This Country Intelligence Report offers a thorough, forward-looking analysis of El Salvador’s telecommunications and pay-TV markets, service providers and key opportunities in a concise format to help executives build proactive and profitable growth strategies.
  • Accompanying GlobalData’s Forecast products, the report examines the assumptions and drivers behind ongoing and upcoming trends in El Salvador’s mobile communications, fixed telephony/VoIP, broadband and pay-TV markets, including the evolution of service provider market shares.
  • With more than 20 charts and tables, the report is designed for an executive-level audience, boasting presentation quality.
  • The report provides an easily digestible market assessment for decision-makers built around in-depth information gathered from local market players, which enables executives to quickly get up to speed with the current and emerging trends in El Salvador’s telecommunications and pay-TV markets.
  • The broad perspective of the report coupled with comprehensive, actionable detail will help operators, equipment vendors and other telecom industry players succeed in the challenging telecommunications market in El Salvador.


Executive summary
Market and competitor overview
Regional context
Economic, demographic and political context
Regulatory environment
Demand profile
Service evolution
Competitive landscape
Major market players
Segment analysis
Mobile services
Fixed services
Pay-TV services
Identifying opportunities
Opportunities in the market
About the authors
Country Intelligence Report coverage
List of Tables
El Salvador telecom market size and growth prospects in a regional context, 2016E
Country indicators
Regulatory structure and policy
Major telecommunications policy issues
El Salvador communications market revenue, 2014-2021, US$
Segment revenue CAGRs, 2016-2021, Rp
Segment revenues 2014-2021
Service revenue mix: voice, data & video, 2016, 2021
Service revenue mix: fixed & mobile, 2016, 2021
Service revenue by operator, 2016
Key telecom market players
Major telecommunications market players
Mobile subscriptions and penetration, 2014-2021
Key mobile market indicators, 2016
Mobile services revenue mix, 2016, 2021
Total mobile ARPS; data percentage of total mobile ARPS, 2014-2021
Mobile market shares by subscriptions, 2014-2021
Mobile subscriptions by technology family, 2014-2021
Fixed-line penetration of population, 2014-2021
Key fixed market indicators, 2016
Fixed voice and Internet revenue, 2014-2021
Fixed market shares by service, 2016E
Access lines by technology
Pay-TV subscriptions by technology, 2014-20121
Opportunities in the El Salvador telecommunications market
List of Figures
El Salvador telecom market size and growth prospects in a regional context, 2016E
Country indicators
Regulatory structure and policy
Major telecommunications policy issues
El Salvador communications market revenue, 2014-2021, US$
Segment revenue CAGRs, 2016-2021, Rp
Segment revenues 2014-2021
Service revenue mix: voice, data & video, 2016, 2021
Service revenue mix: fixed & mobile, 2016, 2021
Service revenue by operator, 2016
Key telecom market players
Major telecommunications market players
Mobile subscriptions and penetration, 2014-2021
Key mobile market indicators, 2016
Mobile services revenue mix, 2016, 2021
Total mobile ARPS; data percentage of total mobile ARPS, 2014-2021
Mobile market shares by subscriptions, 2014-2021
Mobile subscriptions by technology family, 2014-2021
Fixed-line penetration of population, 2014-2021
Key fixed market indicators, 2016
Fixed voice and Internet revenue, 2014-2021
Fixed market shares by service, 2016E
Access lines by technology
Pay-TV subscriptions by technology, 2014-20121
Opportunities in the El Salvador telecommunications market

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