Driven By Wider Coverage And Lower Prices, Fiber-Optic Broadband Adoption Gathers Pace In Latin America, Finds Frost & Sullivan
Educating consumers on the benefits of FTTH vital to strengthen demand
With broadband adoption reaching saturation levels in major markets in Latin America, service providers are turning to new products to sustain growth amid intensifying competition. In line with this, fiber-to-the-home (FTTH) connections present a tremendous opportunity as the high speeds of fiber-optic broadband can attract heavy users such as gamers, streaming subscribers, or small and medium businesses that are willing to pay more for a better service.
New analysis from Frost & Sullivan (http://www.ipcommunications.frost.com), Hot Topic—FTTH in Latin America, finds that the market earned revenues of $343.6M in 2012 and estimates this to reach $1605.2M in 2018. Main FTTH markets in Latin America (Argentina, Brazil, Chile and Mexico) are expected to grow at a compound annual growth rate of nearly 30 per cent.
"Typically, first movers in the Latin American FTTH market have been small competitors trying to fight dominant operators," said Frost & Sullivan Information and Communication Technologies Senior Consultant Ignacio Perrone. "However, some leaders have reacted strongly to this competition, and their deployment of new networks along with an intensified price competition will push the FTTH market towards two-digit growth till 2018."
As is the case with any nascent technology, most consumers are still unaware of the benefits of FTTH or its exact features when compared with technologies like ADSL or cable modem. They also do not realize the exact value for money they will receive when contracting FTTH. Moreover, several solutions available in the market use the term fiber, but do not specify if the connection is fiber-to-the-node, fiber-to-the-curb or actually FTTH.
For the FTTH market in Latin America to realize its tremendous growth potential, both vendors and operators need to educate consumers, carefully avoiding unnecessary jargon and clearly defining what a fiber-optic connection is. Service providers must also explain its benefits against other popular technologies, focusing on its speed, symmetric nature, and stability.
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Hot Topic—FTTH in Latin America is part of the Telecom Services Growth Partnership Service program. Frost & Sullivan's related research services include: Latin American Data Communications Services Markets, Latin American Mobile Services Markets Outlook I, and Latin American Mobile Enterprise Services Markets, among others. All research services included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.
SOURCE: Frost & Sullivan