Key Markets and Operators Show Resiliency in Telecommunications, Showing Strong Results During a Difficult Year, Says IDC

MIAMI, FL – OCTOBER 28, 2002 – According to the latest report by IDC Latin America, the telecommunications markets experienced 5 percent growth in revenue terms during 2001 to reach a market value of US $ 72.4 billion . Brazil and Mexico continued to make up the largest share of these revenues accounting for 65 percent of 2001 market revenues.

 

Key markets such as data services, and Internet access grew at a rapid pace and mobile services operators continued to experience subscriber growth in most major markets. The forecast expects them to continuously grow throughout 2006. The mobile services industry has played an increasingly important role in the development of communication services throughout the region and grew at over 31 percent in subscriber terms in 2001 and 55 percent in Mexico.

"Prepaid service plans, increased competition and falling service pricing, in addition to flexible handset pricing have helped to make this sector a rapidly growing and profitable industry for its market participants," said Marc Alexander, analyst at IDC Latin America and author of Latin America Telecom Markets, Review and Forecast 2002.

However, operators providing long distance and local telephony services saw these markets grow at a very slow or even negative rate. The local telephony market grew at a flat rate of .4 percent during 2001. Latin American long distance operators continued to be affected by falling prices and volatile traffic patterns during 2001. Despite a 15 percent increase in domestic long distance minutes of use region-wide, for example, the overall domestic long distance market fell by 1 percent during 2001.

"The local and domestic long distance market showed slight drops during 2001, while international long distance service revenues showed the most dramatic decrease due to increased competition, falling prices and flat traffic patterns which were driven in part by advances in the use of Internet and email as viable substitutions," said Alexander.

The economic and political forces have made the outlook less optimistic for companies doing business in Latin America. There has been a major shift in the business of telecom, which is forcing companies to reconsider their strategies for successfully competing in the industry.

Latin America Telecom Markets, Review and Forecast 2002 report gives a detailed explanation of the Latin American telecommunications market performance during 2001 and the outlook for growth over the next five years. For more information regarding the study, Latin America Telecom Markets, Review and Forecast 2002 IDC #LA1258J or to purchase the complete study, please contact Barbie Cordero of IDC Latin America bcordero@idc.com or at (305) 351-3131.

About IDC Latin America

IDC Latin America has established an unrivaled reputation for analysis of the IT, Internet, and Telecom markets in Latin America. Its research group is comprised of over 90 analysts in Argentina, Brazil, Chile, Colombia, Mexico, and Venezuela who are devoted to generating the most authentic and up-to-date information on these markets. Following a commitment to excellence, IDC has pioneered primary research in the countries of Costa Rica, Dominican Republic, Ecuador, Guatemala, Panama, Peru, and Puerto Rico. This distinctive local presence results in the most comprehensive and trustworthy market coverage of the Latin American region. For more information, visit www.idclatin.com or call 305-351-3131.

About IDC

IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world's leading IT suppliers, IT organizations, ebusiness companies and the financial community. Additional information can be found at www.idc.com.

IDC is a division of IDG, the world's leading IT media, research and exposition company.