Venezuela Telecommunications Report Q3 2013 - New Market Research Report

From: Fast Market Research, Inc.
Published: Tue Jul 02 2013

A heavy government influence helps shape Venezuela's telecoms market, with state-owned firms playing a major role in all aspects of the sector. This not only deters private investment, but also affects private firms already operating in the country, such as Telefonica, as they are unable to repatriate their profits. As the state controls a large portion of the sector, the development of telecoms infrastructure is closely linked to the success, or otherwise, of Venezuela's oil sector - if revenues from oil run dry, then the government lacks funds for other projects. Our latest quarterly report shows that the mobile sector is consolidating its position above the 100% penetration market, with considerable net addition posted this quarter. This growth comes despite the proceeding chaos following former President Hugo Chavez's death in March 2013.Additionally, for yet another quarter running, the fixed-line sector also posted gains while broadband continues to grow.

Full Report Details at

Key Data

* Total mobile subscribers increased to above 106% penetration market this quarter, with the latest data from Q412 stating that there are 31.732mn mobile subscribers in Venezuela. Of these, 3.1mn are postpaid.
* In the fixed-line market, Venezuela continues to report growth, according to Conatel. The market finished with 7. 6mn subscribers in Q412, up by 6% year-on-year (y-o-y).
* Conatel reported that Venezuela had 12.6mn internet users and 3.6.6mn broadband subscribers in Q412. Of these, 1.4mn were mobile broadband users and 2.0mn fixed-line users.

Risk/Reward Ratings

Venezuela fell one place in our Q313 Risk/Rewards ratings for Latin America, and is now in equal 11th place with Nicaragua. It was the biggest mover in terms of score, falling by 3.4 points, the result of the chaos which has emerged in the wake of President Hugo Chavez's death in March. Despite his legacy being continued by his handpicked successor, who won the general election on April 14 2013, it is doubtful that Maduro will be able to hold power in a country which has for over a decade been micromanaged by his predecessor. Further, rampant inflation and the recent currency devaluation bodes ill for the telecoms sector.

Consumers are likely to cut their spending on telecoms services dramatically. We believe that operators will take a hit in real terms to profits and ARPUs, and the devaluation will also severely effect sales volumes in nominal terms in Q113.

Key Trends & Developments

* In March 2013, the National Telecommunications Commission of Venezuela (CONATEL) announced a public consultation on the use of the 2,500MHz-2,690MHz spectrum band for the launch of 4G LTE. The consultation ran from March 25 2013 to April 9 2013, with all interested parties invited to participate.

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You may also be interested in these related reports:

- Sri Lanka Telecommunications Report Q3 2013
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