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Venezuela - Telecoms, Mobile, Broadband and Forecasts

Smartphones and satellite pay TV drive Venezuela’s telecom market

The general outlook for 2013 is not promising for Venezuela, as the country faces a sharp economic slowdown and galloping inflation amidst political tension and shortages in basic household items such as food and toiletries. Nevertheless, the telecom market is expected to grow by about 10%, led by 3G – including both mobile broadband and phone based internet browsing – and satellite-based pay TV services.

Despite continued growth in the number of fixed lines, 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 and 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 Venezuela’s GDP per capita, which is the third highest in South America after Chile and Uruguay. 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. DirecTV, Movistar, and CANTV provide satellite TV services, NetUno and SuperCable provide cable TV and cable broadband access, while Inter provides satellite TV as well as cable TV and triple play packages. DirecTV still holds a lion’s share of the market, followed by Inter, but CANTV and Movistar are the fastest growing. NetUno and SuperCable have a small and dwindling share.

Mobile penetration in Venezuela is well below the South American average and – like broadband – it compares poorly with the country’s GDP per capita. 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 smartphones. Indeed, Venezuela is the number one country in Latin America for Blackberry handsets.

Three 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;
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 about 50%;
a second Chinese-built satellite for Venezuela (Miranda) has been launched on schedule;
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;
about one third of Venezuela’s mobile subscribers still use CDMA technology;
Smartphone app Abasteceme helps Venezuelans through food shortages;
Venezuela continues to have the region’s highest mobile ARPU but currency devaluations have been eroding revenue in US$ equivalent and the US$ value of ARPU is likely to shrink further in 2013;
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 has been growing by more than 20% annually, but continues to suffer from rampant signal theft;
The three main telcos – CANTV, Movistar, and Digitel – have announced ambitious investment plans, largely aimed at improving their networks and installing new technology including FttH and LTE.

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.

Venezuela’s fixed-line, broadband, and mobile statistics – 2011 - 2013
Sector | 2011 | 2012 | 2013 (e)
Fixed-lines in service
Total subscribers (million) | 7.33 | 7.65 | 7.90
Broadband
Total subscribers (million) | 1.82 | 2.04 | 2.23
Mobile telephony subscribers
Total subscribers (million) | 28.78 | 30.52 | 31.80
(Source: BuddeComm based on industry data)


  • EXECUTIVE SUMMARY
  • KEY STATISTICS
    • Table Country statistics - 2013
    • Table Telephone network statistics - 2013
    • Table Internet user statistics - 2013
    • Table Broadband statistics - 2013
    • Table Mobile statistics - 2013
    • Table National telecommunications authority
    • COUNTRY OVERVIEW
      • Table Evolution of GDP in Venezuela - 2000 - 2014
      • Outlook
  • TELECOMMUNICATIONS MARKET
    • OVERVIEW OF VENEZUELA'S TELECOM MARKET
      • Table Fixed and mobile market share - 1998 - 2013
    • MARKET ANALYSIS2013
      • Table Telecom revenues and investments - 2001 - 2013
      • Table Telecom revenue as a percentage of GDP - 2001 - 2013
      • Table Telecom revenues by segment - 2008 - 2012
  • REGULATORY ENVIRONMENT
    • REGULATORY AUTHORITY
      • Telecom Ministry
      • Conatel
  • FIXED NETWORK OPERATORS
    • OVERVIEW OF OPERATORS
      • Local fixed-line market
        • Table Fixed-line prepaid/postpaid ratio - 2001 - 2013
      • Long distance fixed-line market
    • CANTV
      • Table CANTV at a glance
      • Table CANTVfixed lines in service and market share - 1999 - 2013
    • MOVISTAR (TELEFÓNICA)
      • Table Movistarfixed lines in service and market share - 2004 - 2013
    • DIGITEL
    • INTER
    • NETUNO
  • TELECOMMUNICATIONS INFRASTRUCTURE
    • NATIONAL TELECOM NETWORK
      • Fixed-line statistics
        • Table Fixed lines in service and teledensity - 1997 - 2013
        • Table Public payphones - 1997 - 2013
    • INTERNATIONAL INFRASTRUCTURE
      • Terrestrial links
      • Submarine cable networks
      • Satellite networks
    • INFRASTRUCTURE DEVELOPMENTS
      • IP and Voice over Internet Protocol (VoIP)
    • WHOLESALE OVERVIEW
  • BROADBAND MARKET
    • OVERVIEW
      • Fixed broadband statistics
        • Table Internet users and user penetration rate - 1998 - 2013
        • Table Fixed broadband subscribers and penetration rates - 2000 - 2013
        • Table Fixed broadband technologies-market share - 2001-2013
        • Table CANTVbroadband subscribers - 2000 - 2013
      • Broadband market analysis
      • Broadband providers
    • GOVERNMENT INITIATIVES
      • Laptops for schools
      • National Fibre-Optic Backbone Project
    • CABLE MODEMS
    • ASYMMETRICAL DIGITAL SUBSCRIBER LINE (ADSL)
    • FIBRE-TO-THE-HOME (FTTH)
    • WIMAX
    • MEDIA CONVERGENCE
      • Triple play
      • Broadband TV (IPTV)
  • DIGITAL MEDIA / DIGITAL ECONOMY
    • DIGITAL ECONOMY
      • E-commerce
        • Table Venezuela-B2C e-commerce spending - 2005 - 2013
    • DIGITAL MEDIA
      • Broadcasting
        • Table Pay TV subscribers and penetration rates - 1997 - 2013
        • Table Major pay TV providersmarket share - 2010 - 2013
      • Social networks
        • Table Facebook users and penetration - 2008 - 2013
  • MOBILE COMMUNICATIONS
    • OVERVIEW OF VENEZUELA'S MOBILE MARKET
      • Mobile statistics
        • Table Mobile subscribers and penetration rate - 1997 - 2013
      • Average Revenue per User (ARPU)
        • Table Mobile ARPU - 2002 - 2012
        • Table Mobile ARPU by operator - 2009 - 2012
      • Spectrum auction
      • Mobile market analysis
    • MOBILE TECHNOLOGIES
      • CDMA
      • Third Generation (3G) mobile
      • Long-term evolution (LTE)
      • Mobile handsets/smartphones
    • MAJOR MOBILE OPERATORS
      • Table Market share of mobile operators - 2001 - 2013
      • Movilnet (CANTV)
        • Table Movilnet at a glance
        • Table Movilnetmobile subscribers - 2001 - 2013
      • Movistar (Telefónica)
        • Table Movistar at a glance
        • Table Movistar subscribers - 2001 - 2013
      • Digitel
        • Table Digitel at a glance
    • MOBILE VOICE SERVICES
      • Prepaid
        • Table Mobile prepaid/postpaid ratio - 1997 - 2013
    • MOBILE MESSAGING
      • Short Message Service (SMS)
        • Table SMS messages sent - 2002 - 2013
    • MOBILE BROADBAND
      • Table Mobile broadband subscribers - 2008 - 2013
    • MOBILE SATELLITE
  • FORECASTS
    • FORECASTSFIXED-LINE MARKET 2015; 2020
      • higher fixed line growth
        • Table Forecast fixed lineshigher growth scenario - 2015; 2020
      • lower fixed line growth
        • Table Forecast fixed lineslower growth scenario - 2015; 2020
    • FORECASTSFIXED BROADBAND MARKET2015; 2020
      • higher broadband growth
        • Table Forecast broadband subscribershigher growth scenario - 2015; 2020
      • lower broadband growth
        • Table Forecast broadband subscriberslower growth scenario - 2015; 2020
    • FORECASTSMOBILE MARKET2015; 2020
      • higher mobile market growth
        • Table Forecast mobile subscribershigher growth scenario - 2015; 2020
      • lower mobile market growth
        • Table Forecast mobile subscriberslower growth scenario - 2015; 2020
      • Notes on scenario forecasts

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