Special Report IPTV in Latin America: lots to expect from it In Latin America, the development of Pay TV services through the Internet (IPTV) is still far from what can be achieved if you compare it to Asia, the U.S. or Europe, where there are already a sizable number of operators and an established market. Although some services have been launched in Latin America, bandwidth availability, available technology and regulation are some of the roadblocks being faced.

IPTV: Estimated Market Share, by regions (2013) On top of this, being IPTV competition to satellite-delivered channels (DTH) and cable, it is expected it will grow less in those countries where there services are well developed, which is the case of the three largest territories: Mexico, Argentina —where cable penetration exceeds 60%— and Brazil. Considering these aspects, It is estimated that the IPTV business will not be a commercially important factor during the next five years, but will take off by 2011-2012, when the needed technological infrastructure will be more widely available. Regarding bandwidth, while about 100 Mega bits per second are often delivered in Asia and the Chinese government is promoting connectivity, in the U.S. the level is at 30 Mbps; in Europe, 15 Mbps on average is customary. En Latin America customers may be delivered an average of 2.5 to 3 Mbps, which is not enough to receive a traditional TV channel over the Internet. Source: Informa Telecoms & Media

Latin America and other regions In the recent past, some efforts have been deployed regarding IPTV in Latin America. In Chile, Telefónica has started testing On Demand, an IPTV service available in certain quarters of Santiago. For the time being, there are no plans to expand the service. Also in Chile, telco Telsur is offering a wireless service, but few details are known about its results. In São Paulo, Brazil, Telefónica is building a FTTH network through TVA, the pay television company formerly controlled by Abril Publishers and now managed through Telesp. A report by Informa Telecoms & Media indicates that Telefónica will reach 1.5 million pay TV subscribers (DTH, cable and IPTV) by the end of 2009. It describes that 'In 2007 there were 9,000 IPTV clients producing revenues of $2 million, but by 2013 there will be 2 million households (1.6% of the households in the region) consuming IPTV services, with revenues of $1.3 per year. Brazil will have 37% of the subscribers and 44% of these revenues; Mexico, 25% of the subscribers and 23% of the revenues'. On the other hand, it was expected that Telmex would launch IPTV television in Mexico when allowed to do so, but its moves in other nations (Chile, Brazil, Peru, Ecuador and Colombia, among others) suggest that it will apply DTH and not IPTV. The closest to Latin America regarding IPTV, beyond the Santiago experience and a test in Buenos Aires, Argentina, is Imagenio, its (600,000 subscribers) operation in Spain. According to another Informa Telecoms & Media report, in 2008 there were 18.6 million IPTV subscribers around the world; 7.5 million were in Western Europe; 6.5 million in Asia; 3.4 million in North America; 1.07 million in Eastern Europe and the Middle East and 100,000 in Latin America. All in all, the main obstacles for IPTV expansion in Latin America are: the need to upgrade networks; to reach the home with Fiber to the Home, FTTH; and, the application of technologies Docsis 3.0 or more in order to obtain not only more bandwidth available but also the stability required by a high-quality TV signal. Among the reasons to give IPTV an impulse, offering users the possibility of tuning into channels not offered by the cable or DTH operator is important. The cable operators will be able to improve the use of their bandwidth, and devote more bandwidth to the most profitable uses.