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Venezuela - Telecoms, Mobile, Broadband and Forecasts


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Smartphone sales soar as Venezuelans flock to social networks

Substantial improvements in Venezuela’s telecom infrastructure have made service availability relatively high compared with the rest of Latin America. The country’s telecom market is expected to grow by at least 10% in 2012, led by 3G including both mobile broadband and phone-based internet browsing. The outlook for 2013 is less promising, as Venezuela’s petroleum-dependent economy leaves it vulnerable to sudden booms and busts tied to the global oil market, and oil prices are on the way down. After the October 2012 general elections, an economic slowdown is probable, and this would temporarily put a break on telecom market growth.

Despite a sustained increase in the number of fixed lines in service, Venezuela’s fixed-line revenues account for a shrinking portion of total telecom revenues, while the share of mobile, internet, and pay TV revenues has been rising. A number of private operators compete in all telecom sectors, but CANTV, the country’s state-owned telecom incumbent, dominates the fixed, mobile, and broadband markets.

Venezuela’s teledensity is one of the highest in Latin America, having almost doubled since 2005. In the local telephony market, four companies compete with CANTV: NetUno, Inter, Movistar, and Digitel. NetUno and Inter are primarily cable TV companies, while Movistar and Digitel are primarily mobile operators. NetUno and Inter provide fixed-line services over their cable TV network as part of triple play packages (including pay TV, broadband, and fixed-line telephony). Movistar and Digitel offer local phone services using fixed-wireless technology.

Venezuela’s fixed broadband penetration and speed are lower than the regional average and less than would be expected based on GDP per capita, which in Venezuela is higher than in Latin America as a whole. Partly due to the economic slowdown and partly to the rising popularity of mobile broadband, growth in the fixed broadband market has slowed.

CANTV is the country’s exclusive ADSL provider. A few cable TV companies offer cable modem access and there is one WiMAX provider. The Venezuelan government has launched a National Fibre-Optic Backbone project to guarantee a uniform distribution of high-speed internet access throughout the national territory. CANTV is in charge of implementing the project. The government intends to lease capacity on the National Fibre-Optic Backbone to cooperatives and small companies.

Pay TV is the fastest growing telecom sector in Venezuela after mobile broadband, and accounts for 15% of all telecom revenue in the country. The market leaders are DirecTV, Inter, SuperCable, NetUno, Movistar, and CANTV.

Mobile penetration in Venezuela is about 7% below average for South and Central America. The mobile market is recovering from the downturn it took during Venezuela’s economic recession, but estimated growth is small compared with previous years.

Despite the slump in mobile subscriber growth, the volume of data traffic has been increasing exponentially. Spurred by the huge popularity of social networks in Venezuela, the country has experienced an unanticipated surge in the demand for 3G and smart phones. Indeed, Venezuela is the number one country in Latin America for Blackberry handsets.

Three major players operate in the Venezuelan mobile market: Movilnet, the market leader and mobile subsidiary of state-owned CANTV; Movistar, the Venezuelan unit of Spain’s Telefónica; and Digitel, a locally owned private company.

Key developments:

Venezuela’s fixed-line teledensity has been increasing at a faster pace than any other Latin American country;
telecom revenue as a percentage of GDP has shrunk in the past few years;
internet sales (including fixed and mobile broadband) are the fastest growing telecom revenues;
driven by Twitter and Facebook, smartphone penetration in Venezuela is one of the highest in the region;
in the five years since it was renationalised, CANTV has increased the country’s fibre-optic backbone infrastructure by 48%;
a new Chinese-built satellite for Venezuela (Miranda) is scheduled for launch in October;
Movilnet, Movistar, and Digitel have been allocated additional spectrum;
mobile operators are having to invest in their networks, which suffer from severe congestion;
Digitel, Movistar, and MovilMax (a WiMAX provider) plan to deploy 4G/LTE networks in 2013/2014;
more than one third of Venezuela’s mobile subscribers still use CDMA technology;
Venezuela continues to have the region’s highest mobile ARPU;
the National Fibre-Optic Backbone project aims to build a 6,940Km network;
Venezuela ranks third in the world for Facebook users as a percentage of internet users;
Venezuela’s pay TV market suffers from rampant signal theft;
in 2011/2012, two more companies entered the Venezuelan satellite TV market: CANTV and Inter.

Venezuela’s fixed-line, broadband, and mobile statistics – 2010 - 2012
Sector | 2010 | 2011 | 2012 (e)
Fixed-lines in service
Total subscribers (million) | 7.08 | 7.33 | 7.56
Broadband
Total subscribers (million) | 1.67 | 1.81 | 1.90
Mobile telephony subscribers
Total subscribers (million) | 27.88 | 28.78 | 29.70
(Source: BuddeComm based on industry data)
For those needing an objective and high-level strategic analysis on Venezuela, this report is essential reading and gives further information on:

The development of Venezuela’s fixed-line, mobile, broadband, and pay TV sectors together with industry outlook and forecasts.

Company performance, ARPU, and spectrum awards.

An analysis of Venezuela’s broadband sector.

The government’s ICT projects.

The development and expansion of mobile broadband in Venezuela.How different scenarios are likely to affect the fixed-line, mobile, and broadband markets in the years to 2020.


1. Key Statistics
2. Country Overview
2.1 Outlook
3. Telecommunications Market
3.1 Overview of Venezuela’s telecom market
3.2 Market analysis – 2012
4. Regulatory Environment
4.1 Regulatory authority
4.1.1 Telecom Ministry
4.1.2 Conatel
5. Fixed Network Operators
5.1 Overview of operators
5.1.1 Local fixed-line market
5.1.2 Long distance fixed-line market
5.2 CANTV
5.3 Movistar (Telefónica)
5.4 Digitel
5.5 Inter
5.6 NetUno
6. Telecommunications Infrastructure
6.1 National telecom network
6.1.1 Fixed-line statistics
6.2 International infrastructure
6.2.1 Terrestrial links
6.2.2 Submarine cable networks
6.2.3 Satellite networks
6.3 Infrastructure developments
6.3.1 IP and Voice over Internet Protocol (VoIP)
6.4 Wholesale
6.4.1 Overview
7. Broadband Market
7.1 Overview
7.1.1 Fixed broadband statistics
7.1.2 Broadband market analysis
7.1.3 Broadband providers
7.2 Government initiatives
7.2.1 Laptops for schools
7.2.2 National Fibre-Optic Backbone Project
7.3 Cable modems
7.4 Asymmetrical Digital Subscriber Line (ADSL)
7.5 Fibre-to-the-Home (FttH)
7.6 WiMAX
7.7 Media convergence
7.7.1 Triple play
7.7.2 Broadband TV (IPTV)
8. Digital Media / Digital Economy
8.1 Social networks
8.2 Broadcasting
8.2.1 Pay TV overview
8.2.2 Cable TV
8.2.3 Satellite-based digital pay TV developments
8.2.4 Digital terrestrial TV
9. Mobile Communications
9.1 Overview of Venezuela’s mobile market
9.1.1 Mobile statistics
9.1.2 Spectrum auction
9.1.3 Mobile market analysis
9.2 Mobile technologies
9.2.1 CDMA
9.2.2 Third Generation (3G) mobile
9.2.3 Long-term evolution (LTE)
9.2.4 Mobile handsets/smart phones
9.3 Major mobile operators
9.3.1 Movilnet (CANTV)
9.3.2 Movistar (Telefónica)
9.3.3 Digitel
9.4 Mobile voice services
9.4.1 Prepaid
9.5 Mobile messaging
9.5.1 Short Message Service (SMS)
9.6 Mobile broadband
9.7 Mobile satellite
10. Forecasts
10.1 Forecasts – fixed-line market 2015; 2020
10.1.1 Scenario 1 – higher fixed line growth
10.1.2 Scenario 2 – lower fixed line growth
10.2 Forecasts – fixed broadband market – 2015; 2020
10.2.1 Scenario 1 – higher broadband growth
10.2.2 Scenario 2 – lower broadband growth
10.3 Forecasts – mobile market – 2015; 2020
10.3.1 Scenario 1 – higher mobile market growth
10.3.2 Scenario 2 – lower mobile market growth
11. Glossary of Abbreviations
List of Tables, Charts and Exhibits
Table 1 – Country statistics – 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 Venezuela – 2000 - 2013
Table 8 – Fixed and mobile market share – 1998 - 2012
Table 9 – Telecom revenues and investments – 2001 - 2012
Table 10 – Telecom revenue as a percentage of GDP – 2001 - 2012
Table 11 – Telecom revenues by segment – 2008 - 2012
Table 12 – Fixed-line prepaid/postpaid ratio – 2001 - 2012
Table 13 – CANTV – fixed lines in service and market share – 1999 - 2012
Table 14 – Movistar – fixed lines in service and market share – 2004 - 2012
Table 15 – Fixed lines in service and teledensity – 1997 - 2012
Table 16 – Public payphones – 1997 - 2012
Table 17 – Internet users and user penetration rate – 1998 - 2012
Table 18 – Fixed broadband subscribers and penetration rates – 2000 - 2012
Table 19 – Fixed broadband technologies – market share – 2001-2012
Table 20 – CANTV – broadband subscribers – 2000 - 2012
Table 21 – Facebook users and penetration – 2008 - 2012
Table 22 – Pay TV subscribers and penetration rates – 1997 - 2012
Table 23 – Major pay TV providers – market share – 2010-2012
Table 24 – Mobile subscribers and penetration rate – 1997 - 2012
Table 25 – Evolution of mobile ARPU in Venezuela – major operators – 2008 - 2011
Table 26 – Market share of mobile operators – 2001 - 2012
Table 27 – Movilnet – mobile subscribers – 2001 - 2012
Table 28 – Movistar subscribers – 2001 - 2012
Table 29 – Mobile prepaid/postpaid ratio – 1997 - 2012
Table 30 – SMS messages sent – 2002 - 2012
Table 31 – Mobile broadband subscribers – 2008 - 2012
Table 32 – Forecast fixed lines – higher growth scenario – 2015; 2020
Table 33 – Forecast fixed lines – lower growth scenario – 2015; 2020
Table 34 – Forecast broadband subscribers – higher growth scenario – 2015; 2020
Table 35 – Forecast broadband subscribers – lower growth scenario – 2015; 2020
Table 36 – Forecast mobile subscribers – higher growth scenario – 2015; 2020
Table 37 – Forecast mobile subscribers – lower growth scenario – 2015; 2020
Chart 1 – Fixed and mobile subscribers in Venezuela – 1998 - 2012
Chart 2 – Evolution of revenues and investments – 2001 - 2012
Chart 3 – Telecom revenue breakdown at a glance – 2012
Chart 4 – Fixed lines in service – market evolution at a glance – 2003 - 2012
Chart 5 – Fixed broadband subscribers – market evolution at a glance – 2003 - 2012
Chart 6 – Pay TV market share at a glance – 2012 (Mar)
Chart 7 – Mobile subscribers – market evolution at a glance – 2003 - 2012
Chart 8 – Mobile ARPU at a glance – 2008 - 2011
Chart 9 – Mobile market share at a glance – 2012 (Mar)
Exhibit 1 – Map of Venezuela
Exhibit 2 – CANTV at a glance
Exhibit 3 – Movilnet at a glance
Exhibit 4 – Movistar at a glance
Exhibit 5 – Digitel at a glance

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