Pay TV penetration in Latin America to double over next five years due to IPTV competition, predicts report

April 7, 2008 – The penetration of pay TV in Latin America will double over the next five years due to competition from telcos launching IPTV, according to a new report from research and consulting company TVTelco Latam.

The report, entitled “IPTV and Pay TV in Latin America 2007-2012”, found that although IPTV will play a growth driving force, it will not play a “dominant one”.  It will however help the number of pay TV subscribers in the region increase from 27mn at the end of last year to 59mn by 2012.

“The pay TV industry is passing through a strong deployment moment in Latin America, as a result of competition arrival and the region’s economic growth,” commented Ariel Barlaro, CEO of TVTelco Latam.

Mexico is expected to record an increase in penetration of pay TV from 23% at the end of last year to 38% by 2012, provided the Convergence Agreement is applied soon.  IPTV operators are expected to add 2.3mn new subscribers in the country by 2012.

The reports projects that penetration of pay TV in Brazil could triple if 29 Bill (PL29) is passed, which would enable Brazilian incumbent telcos to offer broadcast channels via IPTV.  Brazil had a penetration rate of just over 10% by the end of last year.

Argentina reportedly “runs the risk of being left behind”, both in terms of growth and adoption of new services, as it has the “most restrictive” IPTV regulation.

If IPTV services are developed in Venezuela due to the technology forming part of national communication policy for state-owned incumbents, the current penetration for pay TV of 24% is expected to double by 2011, while Ecuador will likewise double its current 7% penetration, and Uruguay could have the most developed pay TV market in Latin America by 2012.