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State of mobile in Latin America: the latest stats, research and trends

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Posted by mobiThinking - 06 Sep 2010
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Latin America – i.e. South and Central America – and the Caribbean has the hallmarks of a mobile market as exciting, if not in some ways more so, than Asia or Africa. Prompted by the Mobile Marketing Association’s Latin America conference last week, mobiThinking has been on a data quest.
The available statistics, collated below, are very encouraging, but we’d like to see analysts focus more on Latin America as a continent, rather than zooming in on individual nations, mostly Brazil, or the incongruous practice of grouping Brazil with Russia, India and China (BRIC), rather than its geographical neighbors.
While MMA’s Global Awards (and others) are starting to show off best practice mobile campaigns from Latin America from agencies such as Mobext (see this profile for case studies), Pontomobi (see this profile for case studies), and AndinaTech, mobiThinking gets the feeling that we’re just scratching the surface.

What makes Latin America an exciting mobile market?

• 1) Mobile penetration across Latin America is very high – at 89 percent it’s almost as high as the US and considerably higher than China or India (the two countries that get mobile experts most excited, due to their vast populations). This should make the mobile – starting with SMS (which works on virtually all handsets), then moving on to mobile Web – the priority channel for companies to reach customers.
• 2) In common with all developing regions, PC, fixed Internet and fixed phone-line penetration is and will remain much lower than in the US or Europe. This makes Latin American countries prime candidates for mobile to become the primary access route to the Web. But today the number of people with Internet-friendly phone packages is still worryingly low.
• 3) There is more commonality of first language (i.e. Spanish, Portuguese, French, and English), arguably also culture, between Latin American and Caribbean nations than Asia, Europe or Africa.
• 4) Latin America is a natural expansion for Spanish, Portuguese and US companies that target North America’s Hispanic and Caribbean communities via mobile. Two examples are Spanish telecommunications company Telefonica, see countries of operation here and mobile agency Mobext – see this profile for more details.
• 5) With a population of 589 million, the Latin America and Caribbean continent is more similar in size to North America (352 million) and Europe (733 million), than Africa (1,033 million) and Asia (4,167 million).

Round-up of available data on mobile in Latin America

Mobile Connections in Latin America exceeds half a billion or 86 percent of the population, according to the mobile trade body 3G Americas, March 2010.

International Telecommunications Union (ITU) tells mobiThinking that in 2009 the aggregate data for Latin America and Caribbean was:
• 89 mobile cellular subscriptions per 100 inhabitants.
• 6.4 fixed (wired) broadband subscriptions per 100 inhabitants.
• 4.2 mobile cellular subscriptions with access to data communications at broadband speeds per 100 inhabitants.

The top mobile countries in Latin America are, unsurprisingly, those with the largest populations. Compared to the US and UK (included for comparison purposes), all countries have much lower broadband penetration per population and mobile phones outnumber fixed lines by multiples of 4 to 8 times, compared to 2 or 2.5 times in the US and UK. The data in the chart below is compiled from the ITU’s excellent and free ICT Statistics Database.

Top mobile countries in Latin America
Country Population in 2009
(in millions)
GDP per capita
in 2008(US $)
subscriptions in 2009
Mobile subscriptions
per 100 population
Ratio of mobile to
fixed telephone lines
Broadband subscriptions
per 100 population
Brazil 194 8,208 173,959 90% 4.2 : 1 8%
Mexico 110 10,023 83,528 76% 4.3 : 1 9%
Colombia 46 5,415 42,160 92% 5.6 : 1 5%
Argentina 40 8,280 51,891 129% 5.3 : 1 9%
Peru 29 4,424 24,700 85% 8.3 : 1 3%
Venezuela 29 11,386 28,124 98% 4.1 : 1 7%
Chile 17 10,091 16,450 97% 4.6 : 1 10%
USA 315 45,769 298,404 95% 1.9 : 1 27%
UK 61.57 43,321 80,376 130% 2.4 : 1 30%
Source: ITU ICT Statistics Database
via: mobiThinking

Three of the key factors for spread of the mobile Internet are: a) availability of high-speed mobile networks (3G or higher); b) penetration of Internet-friendly, preferably 3G, feature phones or smartphones; and c) affordable or preferably unlimited-use mobile Web. Precise data on these factors isn’t easy to find, however the outlook is promising.
Pyramid Research predicts considerable growth in 3G+ networks and the broad use of smartphones. It expects 8.6 percent of all new phones in Latin America in 2010 will be smartphones, rising to 32 percent of the new handhelds in 2014.
This will drive growth of mobile services, such as m-banking.
Pyramid (July, 2010) also predicts that prepaid mobile Internet services will take off and attract a significant number of users in Latin America.
• A recent Nielsen Company report suggested that in Brazil smartphones currently make up about 10 percent of mobile phones owned in Brazil, which seems high.

At last week’s conference the MMA conducted a survey of attendees asking:
1) What format will have the greatest growth in mobile marketing campaigns in 2011?
• Mobile access to Internet: 33 percent of attendees.
• SMS and MMS: 32 percent.
• Applications: 25 percent.
• Mobile search: 11 percent.
2) What are the most important factors to help grow the mobile marketing business?
• Greater understanding of the subject and its possibilities: 49 percent.
• Establish metrics and indicators: 22 percent.
• Self-regulation and policies to protect consumer privacy: 17 percent.
• Provide better and innovative formats: 11 percent.

What do Latin Americans do on the mobile Web?
According to Opera Software (May 2010), which collects data on people that use its mobile browser, key mobile destinations for Latin Americans are:
• Google, Facebook, Microsoft Live and YouTube, in order of popularity, in most Latin countries.
• Social-networking site Orkut is popular in Brazil. The hi5 network is also popular in some countries.
• Auction site MercadoLibre is popular in most countries.
• Among Opera Mini users Nokia and Sony Ericsson handsets are the most popular.

Assuming mobile behavior in the US translates to mobile behavior in Latin America and Caribbean, then we should expect that (given a flat playing field, i.e. pervasive 3G, 3G phones and affordable data) Latinos and Afro-Caribbean people should be fast adopters of mobile.
According to PEW Internet, Latinos and African-Americans in the US are more likely to own a cell phone than white Americans, and they are more likely to use their device to access the mobile Web, email, social networking or to purchase a product.

Latin Americans love to text
As the CTIA launched its initiative to create a common short-code system across Latin America, which went live this month, we were told:
• Nearly 200 billion mobile messages were sent over Latin America carrier networks during 2008.
• 68 percent of wireless subscribers in Latin America use their SMS functionality at least weekly; nearly double the rate in developed nations.

Brazil and the BRIC or BRICI countries
Brazil is often compared to Russia, India and China (and sometime Indonesia). While we understand that these are considered four of the world’s leading developing nations, mobiThinking wonders if it might be more practical to group Brazil with Mexico, Columbia, Argentina etc. Not only are these countries closer geographically and culturally, they are also closer in population size and mobile penetration rates. More people live in India or China than in the whole of Latin and North America put together.
It would be interesting to know if many companies choose to expand into Brazil or Russia, India and China or to Brazil then Russia, India and China, in which case BRIC studies will be very useful. If companies more commonly choose to expand into Brazil or Mexico, Columbia, Argentina or Brazil then Mexico, Columbia and Argentina – then BRIC studies are merely hypothetical, though fascinating, comparison studies.
• The following data was drawn from Boston Consulting Group’s (BCG), very interesting and free report: Internet’s New Billion report (September 2010).

Mobile subscriptions and mobile Web in BRICI countries
Country Population in 2009
(in millions)
Mobile subscriptions
per 100 population
Mobile Web users
per 100 mobile subscribers
China 1,335 57% 30%
India 1,166 41% 2%
Indonesia 240 66% 5%
Brazil 194 86% 6%
Russia 141 141% 12%
Source: BCG via: mobiThinking

The BCG report makes the following observations:
• About Brazil: home broadband is expensive, keeping PC Internet usage low (though not as low as the other BRIC counties per 100 population), while 3G mobile Web is comparatively cheap. But 3G isn’t widely available, which keeps mobile Web usage at around 11 million or 6 percent of the mobile population.
• About BRICI nations as a whole: unlike developed nations where people learned their Internet habits from the PC Web, in developing nations many learn to use the Web via mobile, which is creating different usage patterns.

Further reading:

• Guide to mobile agencies
• Guide to mobile industry awards
• Guide to mobile ad networks
• Global mobile stats: all latest quality research on mobile Web and marketing in one place
• The insiders' guides to mobile Web marketing:
Japan, Canada, USA, Germany, UK, India, Australia, Spain, South Africa, Brazil

• Conferences & awards for mobile marketers, with offers
• mobiThinking’s page of essential links

Posted by mobiThinking - 06 Sep 2010

mobiThinking's picture

mobiThinking focuses on everything you need to know on the business of mobile and web. With an exhaustive compendium of mobile statistics, practical guides to mobile agencies, ad networks, top mobile markets and more; interviews and analysis, industry events and awards.

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