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Peru - Telecoms, Mobile, Broadband and Forecasts


Attention: There is an updated edition available for this report.

National fibre-optic backbone to drive growth in Peru’s broadband market

BuddeComm’s yearly update of Peru - Telecoms, Mobile, Broadband, and Forecasts provides a comprehensive overview of the trends and developments in the telecommunications market of Peru, including the regulator’s market data for the first quarter of 2012, operator data to mid-2012, other industry data, and expected market developments in the coming years.

Economic conditions

Peru’s economic expansion has made it a star performer in Latin America, but GDP per capita is still far lower than the regional average. Telecom penetration reflects the country’s poverty map. Fixed-line and mobile subscribers are highly concentrated in urban areas – particularly the capital city. Besides poverty, another challenge for Peru is the rugged topography of the Andean mountains and Amazon jungles.

Investment opportunities

Peru’s single concession regime allows for the provision of all telecom services, including fixed-line, mobile, pay TV, and internet. The government favours foreign investment and follows pro-business, pro-growth policies. With GDP expected to expand 6% annually over the next several years, Peru’s telecom sector is a promising arena for investors. The fastest growing telecom markets include mobile telephony, fixed and mobile broadband, and pay TV.

Fixed/mobile consolidation

Fixed/mobile consolidation

continues to reshape Peru’s telecom industry, with both América Móvil and Telefónica having decided to merge their fixed and mobile operations. América Móvil Perú, trading as Claro, has completed the merger by absorption of Telmex Perú, and Telefónica has approved the merger by absorption of Telefónica Móviles Perú into Telefónica del Perú but is waiting for regulatory approval.

Mobile market

While Peru’s fixed-line teledensity is the third lowest in South America after Bolivia and Paraguay, mobile penetration is higher than average for the region, a remarkable achievement considering that the country’s GDP per capita is well below the South American average. However, penetration data hides the fact that almost one quarter of the population has no mobile phone at all, while many Peruvians – especially urban dwellers – have multiple mobile subscriptions.

Broadband market

Fixed broadband subscriber penetration in Peru is considerably lower than average for Latin America. In a country where internet user penetration used to be remarkably high in the days of dial-up, the poor development of fixed broadband may seem surprising. Reasons for the shortcoming are several. Besides the obvious barriers – such as poverty, limited levels of literacy, low computer penetration, and rugged topography – perhaps the biggest problems is the lack of competition, which has made broadband in Peru one of the slowest and most expensive in the region. However, the governments national broadband plan, enacted into law in July 2012, is expected to drive strong market growth in the coming years.

Peru’s fixed-line, broadband, and mobile statistics – 2010 - 2012
Sector | 2010 | 2011 | 2012 (e)
Fixed-lines in service
Total subscribers (million) | 2.95 | 2.95 | 3.05
Broadband
Total subscribers (million) | 0.92 | 1.20 | 1.42
Mobile telephony subscribers
Total subscribers (million) | 29.00 | 32.31 | 35.30
(Source: BuddeComm based on industry data)

Market Highlights

The governments national broadband plan aims to provide internet connectivity via a fibre-optic backbone to the more remote regions of Peru. It will be a massive undertaking, requiring substantial funds to implement, but it could boost Peru’s broadband penetration from 4% in 2011 to 9% in 2016.

Due to Peru’s low fixed broadband penetration, 3G services are likely to boom in the coming years. With the expansion of UMTS networks and the declining price of laptops and smartphones, we expect both mobile broadband and phone-based internet browsing to escalate.

Vietnam’s Viettel is due to become Peru’s fourth mobile network operator, with service launch expected in the first half of 2013, while Virgin Mobile plans to enter the market as a Mobile Virtual Network Operator (MVNO).

The Telecommunications Investment Fund FITEL provides subsidies for telecom services in rural areas and other places that are marginal to private providers. Its 2012 agenda includes 10 projects that are being subsidised and another 23 in the pipeline.

Movistar’s licences have expired, making Peru the second country in Latin America to face the thorny issue of mobile licence renewal. Negotiations between the government and the operator have been fraught with disagreements and difficulties, and have dragged on for more than two years.

This report is essential reading for those needing high-level strategic information and objective analysis on the telecom sector in Peru.

It provides further information on:

Regulatory environment;
Economic trend and its impact on telecommunications;
Telecoms operators – consolidations, acquisitions, new licences;
Company performances and ARPU statistics;
Analyses of Peru’s broadband and mobile sectors, including future outlook;
3G developments, regulatory issues and technologies including HSPA and LTE;
Law for the Promotion of Broadband and for the Construction of a National Fibre-Optic Backbone;
Historical and current subscriber statistics and forecasts.

Data in this report is the latest available at the time of preparation and may not be for the current year.


1. Key Statistics
1.1 Country overview
1.1.1 Outlook
2. Telecommunications Market
2.1 Overview of Peru’s telecom market
2.2 Market analysis – 2012
3. Regulatory Environment
3.1 Background
3.2 Regulatory authorities
3.2.1 Ministry of Transport, Communications, Housing and Construction (MTC)
3.2.2 Osiptel
3.3 Telecommunications Investment Fund (FITEL)
3.4 Multicarrier system
3.5 Interconnect
3.6 Differentiated interconnection charges
3.7 Access
3.8 Mobile Number Portability (MNP)
3.9 Fixed-line tariffs
3.10 Single concession regime
3.11 Telefónica del Perú’s contract
4. Fixed Network Operators
4.1 Overview of operators
4.1.1 Local fixed-line service
4.1.2 Long-distance fixed-line service
4.2 Movistar Perú (Telefónica)
4.3 Claro Perú (América Móvil)
4.4 Americatel Perú
4.5 Gilat To Home Perú (GHP)
5. Telecommunications Infrastructure
5.1 National telecom network
5.1.1 Fixed-line statistics
5.1.2 Public payphones
5.1.3 Rural telephony and FITEL
5.1.4 Copper cable theft
5.2 International infrastructure
5.2.1 Submarine cable networks
5.2.2 Satellite networks
5.3 Infrastructure developments
5.3.1 Very Small Aperture Terminal (VSAT)
5.3.2 Wireless Local Loop (WLL)
5.3.3 CDMA 450
5.3.4 IP and Voice over Internet Protocol (VoIP)
5.4 Wholesale
6. Broadband Market
6.1 Overview
6.1.1 Fixed broadband statistics
6.1.2 Fixed broadband market analysis
6.1.3 Cabinas públicas
6.2 Government initiatives
6.2.1 One Laptop per Child project
6.2.2 FITEL broadband plans
6.2.3 National Fibre-Optic Backbone
6.3 ISPs and broadband players
6.4 Cable modems
6.5 Asymmetrical Digital Subscriber Line (ADSL)
6.6 Wireless broadband
6.6.1 WiMAX
6.7 Fibre-to-the-home (FttH) networks
6.8 Media convergence
6.9 E-commerce
7. Digital Media / Digital Economy
7.1 Broadcasting
7.1.1 Pay TV overview
7.1.2 Cable TV
7.1.3 Satellite-based digital pay TV developments
7.1.4 Digital Terrestrial TV (DTTV)
8. Mobile Communications
8.1 Overview of Peru’s mobile market
8.1.1 Mobile statistics
8.1.2 Mobile market analysis - 2012
8.1.3 Virgin Mobile – MVNO prospects
8.2 Regulatory issues
8.2.1 Spectrum regulations
8.2.2 Spectrum auctions and awards
8.2.3 Mobile licence renewals
8.3 Mobile technologies
8.3.1 Overview
8.3.2 Second Generation (2G) mobile (GSM/CDMA/iDEN)
8.3.3 Third Generation (3G) mobile (UMTS)
8.3.4 Long Term Evolution (LTE)
8.4 Major mobile operators
8.4.1 Movistar Perú (Telefónica Móviles Perú)
8.4.2 Claro Perú (América Móvil)
8.4.3 Nextel del Perú (NII Holdings)
8.4.4 Viettel Peru
8.5 Mobile voice services
8.5.1 Prepaid
8.6 Mobile Messaging
8.6.1 Short Message Service (SMS)
8.6.2 Multimedia Messaging Service (MMS)
8.7 Mobile broadband
8.8 Mobile satellite
9. Forecasts
9.1 Forecasts – fixed-line market 2015; 2020
9.1.1 Scenario 1 – higher fixed line growth
9.1.2 Scenario 2 – lower fixed line growth
9.2 Forecasts – fixed broadband market 2015; 2020
9.2.1 Scenario 1 – higher broadband growth
9.2.2 Scenario 2 – lower broadband growth
9.3 Forecasts – mobile market 2015; 2020
9.3.1 Scenario 1 – higher mobile market growth
9.3.2 Scenario 2 – lower mobile market growth
10. Glossary of Abbreviations
List of Tables, Charts and Exhibits
Table 1 – Country statistics Peru – 2012
Table 2 – Telephone network statistics – 2012
Table 3 – Internet user statistics – 2012
Table 4 – Broadband statistics – 2012
Table 5 – Mobile statistics – 2012
Table 6 – National telecommunications authority
Table 7 – Evolution of GDP in Peru – 2000 - 2013
Table 8 – Fixed and mobile market share - 1997 - 2012
Table 9 – Percentage of households with access to ICT services - 2005 - 2012
Table 10 – Telecommunications revenue – 2001 - 2016
Table 11 – Number of licences per service – 1997; 2001; 2007; 2010; 2011
Table 12 – Fixed lines in service – operator market share – 2001 - 2012
Table 13 – Domestic long distance traffic – operator market share – 2000 - 2012
Table 14 – International long distance traffic (outgoing ) – operator market share – 2000 - 2012
Table 15 – Movistar – fixed lines in service – 2001 - 2012
Table 16 – Claro – fixed lines in service – 2001 - 2012
Table 17 – Fixed lines in service and teledensity – 1997 - 2012
Table 18 – Fibre optic cable – 2002 - 2011
Table 19 – Public telephones – 1997 - 2012
Table 20 – Movistar wholesale accesses – 2005 - 2012
Table 21 – Internet users and user penetration rate – 1997 - 2012
Table 22 – Broadband subscribers and penetration rates – 1999 - 2012
Table 23 – Fixed broadband technologies – market share – 2000 - 2012
Table 24 – Broadband operators’ market share – 2007 - 2012
Table 25 – Cable modem subscribers – 2000 - 2012
Table 26 – ADSL subscribers – 2000 - 2012
Table 27 – Peru – B2C e-commerce spending – 2005 - 2013
Table 28 – Pay TV subscribers and penetration rates – 1998 - 2012
Table 29 – Pay TV operators’ market share – 2002 - 2012
Table 30 – Mobile subscribers and penetration rate – 1997 - 2012
Table 31 – Mobile market share by operator – 1997 - 2012
Table 32 – Evolution of mobile ARPU in Peru – major operators – 2007 - 2010
Table 33 – 2G mobile technologies – subscriber distribution – 2004 - 2012
Table 34 – Movistar – mobile subscribers – 2001 - 2012
Table 35 – Claro – mobile subscribers – 2001 - 2012
Table 36 – Nextel subscribers – 2001 - 2012
Table 37 – Mobile prepaid/postpaid ratio – 2001 - 2011
Table 38 – SMS by operator – 2004 - 2012
Table 39 – MMS by operator – 2004 - 2011
Table 40 – Mobile broadband subscribers and penetration – 2009 - 2012
Table 41 – Forecast fixed line growth – higher growth scenario – 2015; 2020
Table 42 – Forecast fixed line growth – lower growth scenario – 2015; 2020
Table 43 – Forecast broadband subscribers – higher growth scenario – 2015; 2020
Table 44 – Forecast broadband subscribers – lower growth scenario – 2015; 2020
Table 45 – Forecast mobile subscribers – higher growth scenario – 2015; 2020
Table 46 – Forecast mobile subscribers – lower growth scenario – 2015; 2020
Chart 1 – Fixed and mobile subscribers at a glance – 2000 - 2012
Chart 2 – Evolution of telecom revenue at a glance – 2003 – 2014
Chart 3 – Fixed-line market share at a glance – March 2012
Chart 4 – Evolution of fixed lines in Peru – 2000 - 2012
Chart 5 – Fixed broadband technologies – market share at a glance – 2003 - 2012
Chart 6 – Operators’ market share at a glance – 2012
Chart 7 – Pay TV market share at a glance – 2009 - 2012
Chart 8 – Mobile operators’ market share at a glance – March 2012
Chart 9 – 2G mobile technologies – subscriber distribution at a glance – 2004 - 2012
Exhibit 1 – Map of Peru
Exhibit 2 – Telefónica del Perú at a glance
Exhibit 3 – Movistar rebranding
Exhibit 4 – Claro Perú at a glance
Exhibit 5 – América Móvil Perú/Telmex Perú – company history
Exhibit 6 – Bands and spectrum
Exhibit 7 – Telefónica Móviles Perú at a glance
Exhibit 8 – Claro Perú at a glance
Exhibit 9 – Nextel Perú at a glance

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