Research and Markets: Multiplay Revenues to Grow At A CAGR Of 12% between 2010 And 2014 In Latin America

DUBLIN--(BUSINESS WIRE)-- Research and Markets (http://www.researchandmarkets.com/research/56112f/latin_america_tele) has announced the addition of the "Latin America Telecom Insider / Vol. 2, No 5, Edition 8 - Multiplay in Latin America: Aggressive Pricing to Drive Double-Digit Revenue Growth" report to their offering.

Network operators in Latin America will use aggressive pricing strategies to boost subscriber counts and revenues for multiplay services over the next five years, resulting in a projected multiplay revenue growth rate of 58 percent from 2010 to 2014, according to a new report.

Multiplay in Latin America: Aggressive Pricing to Drive Double-Digit Revenue Growth examines the three levers operators will need to pull to ensure they keep their multiplay revenues growing: Increasing the number of customers signing up for bundled services, selling new value-added services to existing clients to increase fees in higher-income segments, and shifting existing multiplay clients from double play to triple play and to quad play. Finally, the report offers three case studies to illustrate the different strategies followed by Latin American operators to retain and increase customers.

While competition and economic factors continue to put pressure on multiplay prices in Latin America, the price erosion is likely to work in operators' favor in terms of expanding their subscriber bases and ultimately increasing total multiplay revenues, says Gerardo Sandoval, Manager for the Latin America region at Pyramid Research. "Operators will need to grow the number of customers subscribing to multiplay services within the current segments and tap into new lower-income segments," he explains. "Declining prices will make multiplay a more appealing product for lower-income families in Latin America, which in turn will have a positive impact on the number of subscribers in the region."

By 2014 multiplay subscribers will reach 52.9 million, Pyramid projects. "We expect that by 2014, 40.1 million households will subscribe to double play, 12.4 million to triple play, and 397,000 to quad play in the region," Sandoval says. "This is a considerable increase from the 32.2 million households subscribing today to multiplay, of which almost 27 million subscribe to double play, 5.3 million to triple play, and 20,000 to quad play," Sandoval explains.

Executive Summary:

Between 2005 and 2009 multiplay subscriptions in Latin America grew steadily at a CAGR of 44%. Multiplay grew at a much faster rate than the total number of people subscribing to pay-TV, fixed broadband and fixed line, which grew at a CAGR of 9.2%. That means that over the last five years people were not only subscribing to pay-TV, broadband and fixed-line service, but those who had already subscribed to them started converting to multiplay bundles.

The benefits for those subscribing to a multiplay bundle range from discounted services to a more convenient relationship with the service provider through consolidated billing and converged services. For operators, there are many benefits to bundling clients in multiplay offerings. Bundled services increase brand loyalty and shifting costs, reducing churn. For instance, Virgin Media, the only quad-play provider in the UK, has a churn rate of 0.7% in its quad-play package, 0.9% in its triple-play package and has an overall churn rate of 1.3%. Multiplay offerings also allow operators to cross-sell additional products and services that not only increase their revenues at a low marginal cost, but allow them to spread their high fixed costs across a larger customer base.

Interestingly, the number of multiplay subscribers was not affected by the crisis. In fact, many subscribed to multiplay services during the economic downturn to access discounted services. According to the UK telecom regulator OFCOM, in 2008 almost 50% of new multiplay subscribers did so to save money during the recession.

Competition and especially the recession have put pressure on multiplay prices. The the average monthly price of double- and triple-play subscriptions in Latin America has declined steadily over the last years, with a deeper dip in 2008. On average, between 2005 and 2009 the price of a multiplay pack declined at an annual rate of 5.9%.

However, Pyramid Research thinks the decline in multiplay prices is necessary to increase revenues. Operators will continue aggressively increasing the number of subscribers and upselling new products and services to existing customers. As a result, we expect multiplay revenues to grow at a CAGR of 12% between 2010 and 2014.

This report examines the three levers operators will need to pull to ensure they keep their multiplay revenues growing: Increasing the number of customers signing up for bundled services, selling new VAS to existing clients to increase fees in higher-income segments, and shifting existing multiplay clients from double play to triple play and to quad play. Finally, the report includes three case studies where we present the different strategies followed by operators to retain and increase customers.

Published monthly for each of the worlds most dynamic regions, Telecom Insiders are packed with trend analysis, industry best practices, market sizing and forecasting, competitor analysis, and case studies, providing you information you can leverage to make better business decisions

Key Topics Covered:

• INTRODUCTION
• MULTIPLAY REVENUE GROWTH IN LATIN AMERICA: AGGRESSIVE PRICING TO INCREASE REVENUES
• Increasing the number of multiplay subscribers
• Value-added services: Growing revenues within the existing customers
• Shifting customers from double to triple and to quad play
• MARKET DETAIL
• CASE STUDY: VTR Chile expanding to lower-income segments with unemployment insurance and tailored multiplay packs
• CASE STUDY: Rogers Home Calling Zone, Canada
• CASE STUDY: Fixed and mobile operators merge to expand multiplay offers
• CONCLUSIONS
• Key findings
• Recommendations
• RELATED RESOURCES
• Table of exhibits

Companies Mentioned:

• Bell Canada
• Claro
• DIRECTV
• Eutelsat
• Movistar
• Orange
• Rogers
• SES Astra
• Sky
• Telmex
• Telus
• Virgin Media
• VTR

For more information visit http://www.researchandmarkets.com/research/56112f/latin_america_tele

Source: Pyramid Research, Inc.

CONTACT:

Research and Markets
Laura Wood, Senior Manager
press@researchandmarkets.com
U.S. Fax: 646-607-1907
Fax (outside U.S.): +353-1-481-1716

KEYWORDS:   South America

INDUSTRY KEYWORDS:   Technology  Networks  Telecommunications

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