New report says Telecom Market in Central America is Growing Despite Widespread Poverty

March 25, 2008 - PRLog -- Report Buyer, the online destination for business intelligence for major industry sectors, has added a new report showing that poverty in Central America is more widespread than in the rest of Latin America, and this is reflected in the development of telecommunications.

“2008 Latin America - Telecoms, Mobile and Broadband in Central America”, which is available at http://www.reportbuyer.com/go/BUD00242, reports that apart from Costa Rica, fixed-line teledensity in the Central American nations is lower than average for Latin America, while in mobile telephony, only El Salvador and Panama are slightly above the regional average. Nevertheless, all telecoms markets are growing.

The report shows that investment opportunities are promising, and there is good scope for the testing of new technologies, particularly in the areas of wireless systems, mobile phones, and broadband.

Authors of the report note that liberalisation of the fixed-line market is at different stages, from Guatemala, which has been open to competition since 1996, to Costa Rica, which remains a state-owned monopoly. They find that Costa Rica’s fixed-line teledensity is one of the highest in Latin America and well beyond what could be expected given its other macroeconomic indicators. Teledensity in Guatemala, on the other hand, is about 40% lower than the overall Latin American average, which would indicate that fixed-line privatisation and competition are no guarantee of development in this market. Nevertheless, Guatemala’s teledensity is no more and no less than would be expected given the country’s other macroeconomic indicators.

The study shows that, due to low fixed-line teledensity, the nations of Central America have leapfrogged directly into mobile communications. Mobile competition is keen, and penetration is far higher that would be expected considering their other macroeconomic indicators. Costa Rica is the only exception, and a colossal one, since it has a single state-owned mobile company, no prepaid cards, and an abysmally low mobile penetration compared with its relatively high GDP per capita.

Broadband uptake varies greatly among these seven countries – from a penetration of around 2.2% in Costa Rica, to less than 0.4% in Nicaragua and Honduras.

The authors note that, despite the generally low telecoms indicators in Central America, these countries have witnessed some of the region’s most advanced technological deployments, such as IPTV in Panama, High Definition TV in Honduras, and WiMAX in El Salvador. This phenomenon is partly due to the leapfrogging of conventional systems often found in developing countries, and partly due to the sharp social disparities, where certain urban areas, particularly in capital cities, enjoy first world telecom services, while rural areas lack even basic telephony.

“2008 Latin America - Telecoms, Mobile and Broadband in Central America” is available from Report Buyer. For more information go to: http://www.reportbuyer.com/telecoms/country_overviews_tel...

Report Buyer product ID: BUD00242

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