Mobile Broadband could well soon become the first choice for accessing the Internet in Latin America. But if the Mobile industry is to extend, and reap, the full benefits of this means of communication, the regulatory framework needs to be revised.
Mobile Broadband continues to grow in Latin America. According to a report from the GSM sector association GSMA, the number of mobile broadband subscriptions grew by 133% per year over the last five years and is forecast to increase by a further 50% per year over the next five years. The sector is capitalising on the relative shortage of and slow development in fixed line infrastructure in the region. By enabling faster adoption of broadband and thus having an impact on broadband growth, Mobile Broadband is set to be, long-term, the primary platform for high-speed Internet services for most Latin Americans who are currently unconnected. By 2015 the region is expected to have more than 750 million mobile connections, i.e. an average penetration of 122%. According to Sebastian Cabello, the GSMA’s Director for Latin America, “During 2011, mobile broadband connections surpassed DSL and cable connections and today represent the best hope for governments to realise their ICT universalisation plans.”
Market already prosperous
The Mobile market is already a key driver of connectivity growth in Latin America. The region is already one of the world’s largest Mobile markets by volume, with more than 630 million connections as of end 2011. The overall Mobile market in Latin America currently generates an estimated $175 billion, or 3.6% of total GDP, with Mobile network operators alone contributing $82 billion in 2010 - 1.7% of the region’s total GDP. In addition to this direct financial contribution, Mobile also plays a substantial part in Latin American economic growth through employment. It has generated almost 600,000 jobs and supports 1 million more. “Latin America is also one of the world’s fastest-growing mobile markets,” points out Sebastian Cabello, driven by“increasing accessibility, flexibility and affordability of mobile services.”
Challenges to be addressed
Nevertheless, Latin America needs to tackle four key regulatory themes that are essential to democratising mobile broadband access and sustaining growth, argues the GSMA. First of all, says the Association, there’s a need for a transparent and predictable regulatory regime in order to foster growth in Mobile Broadband. Second, ineffective taxation should be reduced to enable greater Mobile penetration. Third, incentives are needed to drive universal access and fourth, it is essential to draw up a clear roadmap for spectrum allocation if the increasing demand from end users for Mobile Broadband is to be satisfied. Sebastian Cabello concludes:"It is imperative that we foster, not stifle, Mobile Broadband growth and develop the supportive ecosystem vital for the region.”