The Latin American Fixed Voice Market (On Demand) publication provides key information about the major fixed-line operators in Latin America and the Caribbean. Topics covered include:
Latin American Fixed Voice Market (On Demand)
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Heavyweights dominate Latin America’s fixed-line market but there are exceptions Latin American fixed-line incumbents dominate most national markets. Many of these operators are controlled by multinational companies, but some belong to local investors and a few are state-owned.
The main multinational fixed-line players in Latin America are Telmex, founded and controlled by Mexican billionaire Carlos Slim, and Telefónica, the incumbent telco of Spain. Telefónica dominates the fixed-line market in several countries, while Telmex is the market leader only in Mexico but has operations throughout the region. Telmex’s sister company América Móvil, though predominantly a mobile operator, also provides fixed-line services in a few countries.
In January 2010, Telmex and America Móvil announced the intention to merge operations. The plan is to create a single regional telecoms giant capable of offering bundled fixed, mobile, and broadband services with 250 million subscribers across Latin America.
In late 2009, Telefónica began the process of changing its trading name to Movistar in order to unify all services - fixed-line, broadband, pay TV, and mobile - under the Movistar brand, previously used only for mobile telephony. Telefónica chose Chile as the first country to undergo the process due to its open and sophisticated telecom market.
Oi, controlled by Brazilian investors, is the largest fixed-line operator in Latin America in terms of both revenue and fixed lines in service. It moved from second to first place following its acquisition of Brasil Telecom in 2008/2009. Previously, Telmex was the regional leader in terms of fixed lines in service, and Brazil’s Telesp, owned by Telefónica, was the leader in terms of revenue.
Table 2 - Top ten fixed-line operators by lines in service − 2008 - 2010
Operator Country 2008 2009 2010 (Jun) Half-year change
Fixed lines in service (million)
Oi Brazil 22.07 21.29 20.76 -3%
Telmex (Mexico only) Mexico 17.59 15.88 15.74 -1%
Telesp (Telefónica) Brazil 11.66 11.25 11.26 +0%
Embratel (Telmex) 1 Brazil 5.36 6.45 6.90 +7%
CANTV 1 Venezuela 5.17 5.64 5.78 +3%
TASA (Telefónica) Argentina 4.63 4.64 4.65 +0%
Telecom Argentina Argentina 4.30 4.36 4.07 -7%
TdP (Telefónica) Peru 3.47 3.55 3.45 -3%
Movistar (Telefónica) Chile 2.12 2.03 1.97 -3%
Telefónica Telecom Colombia 2.30 1.64 1.63 -1%
(Source: BuddeComm based on company data)
Note1: Estimates for 2010 (Jun).
Table 1 - Top ten fixed-line operators by revenue, and annual change − 2008 - 2009
Operator Country 2008 2009 Annual change
Oi (wireline only) Brazil 14.96 20.34 +36%
Telmex (Mexico only) Mexico 9.01 9.13 +1%
Embratel (Telmex) Brazil 5.70 8.34 +46%
Telesp (Telefónica) Brazil 8.58 8.26 -4%
CANTV Venezuela 4.59 5.49 +19%
TASA (Telefónica) Argentina 1.45 1.50 +4%
TdP (Telefónica) Peru 1.38 1.44 +5%
CTC (Telefónica) Chile 1.37 1.28 -7%
Telecom Argentina Argentina 1.06 1.09 +3%
Telefónica Telecom Colombia 1.00 0.88 -12%
(Source: BuddeComm based on company data)
Two regional incumbents, Telefónica de Argentina and Telecom Argentina, dominate the local fixed line market, while the long distance market is highly competitive and VoIP is well developed. Telecom Argentina has been subject to years of shareholder disputes and cross-holding scrutiny; harmony may have been finally restored in August 2010 thanks to an agreement (awaiting government approval) between shareholders. Argentina has adopted a single licence system that covers all telecom services (Licencia Única), but operators must register for each service they wish to provide.
About 52% of Brazil’s fixed lines in service are controlled by locally owned Oi, the dominant operator in Region I (north and east Brazil including Rio de Janeiro and Minas Gerais) and Region II (south, southwest, and central Brazil including the Federal District). Telefónica’s Telesp is the dominant operator in Region III (the state of São Paulo), and controls about 27% of Brazil’s total lines in service. The remaining 21% of Brazil’s fixed lines in service belong to Embratel, Net Serviços de Comunicação, GVT, and a few small, private operators. Embratel and Net Serviços are controlled by Telmex, while GVT was acquired by France’s Vivendi in November 2009.
Movistar Chile is the incumbent local telephony provider, with around 57% of the country’s fixed lines in service. Several companies compete with Movistar using technologies based on triple play, WLL, VoIP, and NGN. VTR Globalcom, Chile’s leading cable TV company and triple player, is the second largest provider of local telephony with an 18% share of the country’s fixed lines in service. Entel is the incumbent long-distance carrier in Chile, but since liberalisation, it has been overtaken in the long-distance market by Movistar.
Colombia has some 30 local telephone providers, partly private, and partly owned by the municipalities where they operate. Two state-owned companies are up for sale: ETB, with about 26% of the country’s fixed lines in services, and Emcali, with about 7%.
There are 18 companies licensed to provide fixed-line and fixed-wireless local telephony; however, there are only a few companies actually operating in each sub-region. The incumbent Telmex still dominates the fixed-line market with around 85% of lines. Investment and competition remain stifled by the fact that Mexico is the last country in the OECD yet to unbundle its local loop. Regulatory reform may be on the horizon, with the regulator ruling Telmex to have market dominance, thus opening the way for potentially tougher company-specific regulations.
About 15 fixed telephony operators compete against the incumbent Telefónica del Perú (TdP), which controls 93% of the country’s fixed-lines in service. Long-distance telephony is more competitive than local telephony, but there, too, TdP holds a dominant position, with 83% of the domestic long distance and 77% of the international long distance market.
Besides state-owned CANTV, there are four operators offering local telephony: NetUno and Inter (primarily cable TV companies) provide fixed-line services over their cable TV network as part of triple play packages, while Movistar and Digitel (primarily mobile operators) offer local phone services using fixed-wireless technology. Almost two thirds of Venezuela’s local telephone services are prepaid.