Mobile Broadband Caribbean & Central America

Mobile Broadband Caribbean & Central America 16 November 2016

5G AMERICAS The Voice of 5G and LTE for the Americas 5G Americas is an industry trade organization composed of leading telecommunications service providers and manufacturers. The organization's mission is to advocate for and foster the advancement and full capabilities of LTE wireless technology and its evolution beyond to 5G, throughout the ecosystem's networks, services, applications and wirelessly connected devices in the Americas. 5G Americas is invested in developing a connected wireless community while leading 5G development for all the Americas

MEMBERS

WHITE PAPERS Digital Adoption in Latin America: The Role of Infrastructure Deployment and Other Policies in the Region Cellular Technologies Enabling the Internet of Things LTE Aggregation and Unlicensed Spectrum 5G Technology Evolution Recommendations http://www.5gamericas.org/es/resources/white-papers/

5G The standard that will be known as 5G has yet to be defined. Scheduled to be completed in the year 2020. 2G, 3G, 4G y 5G are commercial names, not technological definitions IMT-2000, IMT-Advanced & IMT-2020 The telecoms industry will still be discussing the requirements that will define IMT-2020 when 1 st non-standardized 5G network is launched Key Requirements Spectrum Fiber Optic International Traffic Gateways

5G Source: http://www.4gamericas.org/files/8914/3576/4557/4g_americas_mobile_broadband_evolution_toward_5g-rel-12_rel- 13_June_2015x.pdf

MOBILE EVOLUTION Source: http://www.4gamericas.org/files/9214/3991/2167/4g_americas_rysavy_research_lte_and_5g_innovation_white_paper.pdf

CALA MOBILE LINES 2016 2020 729 M 746 M 763 M 778 M 791 M 83 119 164 216 277 LTE 365 404 427 432 419 HSPA GSM Other 274 220 170 129 94 Dec 16 Dec 17 Dec 18 Dec 19 Dec 20 Source: Ovum, March 2016

2003 PREDICTIONS Belatedness of liberalization: full telecommunications liberalization has yet to arrive to most Caribbean islands; Small population density: the island s small number of inhabitants will shorten the time period necessary for the market to reach their saturation point, forcing operators with marginal market share to exit the market; Minuscule addressable market: limited organic growth potential will speed up operators expansion outside the horizontal marketplace, triggering a sequence of alliances, mergers, and acquisitions; Local scene: pan-regional operators approaching the Caribbean as a single market will create insurmountable pressure on small one-island operators, forcing their exit or merger with a larger pan-island partner. The Caribbean Role on the Path Towards Consolidation, CANTO s 19th Annual Conference, June 2003

2003 PREDICTIONS Need for complementary services that will boost revenues: saturation of horizontal markets will push the necessity for vertical integration as a tool to increase the operator s potential addressable market and return on investment; Service providers understand that they can not survive as local players: the arrival of multinational players that benefit from economies of scale and can offer lower costs on the provision of services will create enormous pressure on domestic operators without a multinational partner and will make the survival of the independent local player insurmountable; Technological homogeneity becomes crucial: having a homogeneous technology and applications platform across regional operations allows a company to achieve better economies of scale, decreases OPEX, and facilitates subscriber management; Companies focusing on their bottom line: cost reductions become crucial as the Caribbean is currently undergoing an economic slowdown and financial constraints open the door to consolidation, as unprofitable companies will be forced to exit the market. The Caribbean Role on the Path Towards Consolidation, CANTO s 19th Annual Conference, June 2003

MOBILE PENETRATION CARIBBEAN Source: ITU, Operators, Regulators, WEF, World Bank

CARIBBEAN MOBILE LINES Source: ITU, Operators, Regulators, WEF, World Bank

CARIBBEAN MOBILE LINES OPERATORS SUBSCRIBERS Source: ITU, Operators, Regulators, WEF, World Bank

CARIBBEAN INTERNET USERS

MOBILE PENETRATION LATAM 200% 180% 160% 140% 120% 100% 80% 60% 40% 20% 00% Source: Ovum en White Paper Análisis de las recomendaciones de la UIT sobre el espectro en la región América Latina. 5G Americas, abril de 2016

CENTRAL AMERICA MOBILE LINES Source: Pyramid Research

LTE PENETRATION LATAM Source: ITU, Operators, Regulators, WEF, World Bank

EL SALVADOR El Salvador tiene el desafortunado privilegio de ser el país de América Latina que menos espectro radioeléctrico ha otorgado para este fin: 208 MHz. La diferencia con países como Costa Rica o México es que esa cifra se divide entre cuatro operadores móviles que ofrecen dos tecnologías distintas en la actualidad (GSM y HSPA) lo que deja a cada uno con poco espectro para hacer un despliegue de LTE. El otro gran problema de las demoras por las reformas a la ley de telecomunicaciones se observa en el proceso de migración a TDT que se encuentra totalmente paralizado. El Salvador en estos momentos ni tiene estándar definido, ni fecha para su apagón analógico.

ITU SPECTRUM RECOMMENDATIONS Source: ITU

SPECTRUM GRANTED TO OPERATORS Source: 5G Americas

SUMMARY The Caribbean is a complex microcosm where political, cultural and historical variables play a role in the development of the telecommunications sector. Telecom development is asymmetrical in Central America and the Caribbean. Operators may respond to pan- Caribbean, local or trans-national strategies. Exogenous events i.e. wire transfers, roaming, etc. - play a pivotal role in the development of telecommunications services Increased demand in broadband services wired and wireless technologies are driving the regional capacity market. Costa Rica and Panama leading LTE adoption in Central America Cuba s immediate future is not certain.

Questions?