FTTH Council - Panorama LATAM by Roland MONTAGNE, IDATE

FTTH Panorama LATAMMarket at December 2015

and forecasts to 2020

Roland MONTAGNEDirector, Principal Analyst

I IDATE+33 680 850 [email protected]

FTTH Panorama LATAM

• 1. Study background

– Objectives– Available results

• 2. FTTH/B in Latin America

– Overview– Overall figures

• 3. LATAM FTTH/B main trends

– FTTH/B subscribers– FTTH/B Homes Passed distribution– FTTH/B Homes Passed in total HH– Main announcements

• 4. Challenges / drivers for FTTH/B in LATAM

• 5. Forecasts up to 2020

1. Study background

Study background• Mission on behalf of the FTTH Council, LATAM chapter – 4th edition

• Objective: to provide a complete summary of the status of FTTH/B in LATAM– 16 countries analyzed1

– Distinction between architecture: FTTH/B vs FTTN (FTTN/C+VDSL, FTTLA, FTTx+LAN)

– FTTH/B Definition by FTTH Councils Worldwide2

• Characterization of each project includes:

– Organization initiating the project– Key parameters & Figures– Technical parameters– Financing & Business model

• Methodology use– Desk research– Direct contacts with FTTH players (questionnaires, phone interviews) & IDATE’s partners in LATAM– Information exchange with FTTH Council, LATAM chapter members

1 Argentina, Barbados, Bolivia, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, Grenada, Jamaica, Mexico, Peru, Puerto Rico, Trinidad and Tobago, Uruguay 2 FTTH/B definition available here

http://www.ftthcouncil.eu/documents/Publications/FTTH_Definition_of_Terms-Revision_2015-Final.pdf

2. FTTH/B in Latin America

Overview

From significant FTTH/B deployments by incumbents…

… to numerous initiatives from alternative telcos including cable operators

~4 million FTTH/B Homes Passed

Incumbents

143,000 FTTH/B Homes Passed

Municipalities/Utilities

~16 million FTTH/B Homes Passed

Alternative telcos/ISP

At end 2015: 80 FTTx projects

61 players involved in FTTH/B

Source: IDATE for FTTH Council LATAM Chapter

Overall Figures

In December 2015

~3.65 million FTTH/B subscribers~20.1 million FTTH/B Homes Passed

Average Take Up Rate1: 18.1%

(+1.5 points compared to Dec 2014)

1 Take up rate = number of FTTH/B subscribers over number of Homes Passed

Growth Rates Dec 2015/Dec 2014:

Subscribers: +39% Homes passed: +27%


3. Main trends

FTTH/B subscribers trends• Mexico is now leading the LATAM FTTH/B market with 1.29 million subscribers

– +46% of subscribers yoy– Telmex is leading the retail market– TotalPlay covers 14% of the households in the country and expects to have 7.5 million HP by end 2019

• Brazil is just behind Mexico in the LATAM FTTH/B market with 1.25 subscribers

– +32% of subscribers yoy– Telefónica is very active: investment plan of 25 million BRL (~6.3 million USD) between 2015 and 2017– Hundreds of local ISPs involved, but in limited geographical rollouts

• Antel in Uruguay is one of the two most involved incumbents in the region (550,000 FTTH/B subs)

– Even if the trend of FTTH/B subscribers growth is decreasing at + 10% yoy (vs +101% in 2014 yoy), 40% of FTTH/B HP have opted for a service based on FTTH connection

– National coverage: the coverage is considered as exhaustive in Uruguay– Among the leading countries in the global ranking with a penetration rate1 over 40% at end 2015

• Strong growth rates in smaller markets, confirming a general trend towards FTTH/B in the region

– Colombia +456% and Puerto Rico +340%!– Ecuador +96%, Chile +34%

1Penetration rate = number of FTTH/B subscribers over total number of Households

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FTTH/B Homes Passed distribution

• 7 countries with significant rollouts, among which with more than 1 million Homes Passed

Mexico:TotalPlay: massive deployment with +50% yoy

Brazil:Telefonica: the biggest FTTH networkrepresenting 73% of total FTTH HP in the country

Uruguay:The entire country covered

Argentina:More than 10 players involved in rollouts

• Jamaica and Puerto Rico:Some FTTH projects emerged with the goal to deploy their network very quickly

Emerging markets: demography not representative of effective market dynamism

Colombia:Significant investment expected by ETB


• Number of Homes Passed not representative of effective coverage

• Here, the ratio represented is % of FTTH/B Homes Passed in total households– 2 countries > 90% !!!– 7 countries > 10%

% FTTH/B Homes Passed in total Households

• LATAM players are much more involved in FTTH rollouts

• Regarding technology, they have mainly chosen GPON

FTTH/B LATAM technologies

Main architecture deployed* Dec. 2015

FTTH 92%

FTTB 8%

*Home Passed segmentationSource: IDATE for FTTH Council LATAM Chapter

Main technology deployed* Dec. 2015

PON 97%

Ethernet 3%

*Home Passed segmentationSource: IDATE for FTTH Council LATAM Chapter

Key Points for FTTH/B in LATAM

• A new dimension for FTTH in LATAM

– A relative take off in the FTTH market since 2014, but at the scale of the countries

– 9 countries among 16 in the Global Ranking:

• Uruguay in the Top 5 in the world!

• 8 other countries with a penetration rate from 2% to 4%

Key Points

Key Points

• Demography represents a huge potential in LATAM: – large cities with the huge advantage of high density of population…– … as well as small countries which can quickly become mature markets (Caribbean)

• The competition between cablecos and telcos is a driver for FTTH/B: but the consolidation that occurred in 2015 (C&W / Columbus Telecommunications) might slow down this phenomenon

• Low quality of existing copper: Telcos are betting on FTTH/B to promise innovative services and higher speed rates

• Several players are involved in FTTH/B market in different countries in LATAM

• In most of cases, FTTH/B and LTE are together deployed in LATAM

• Governments are pushing the FTTH/B market– National Broadband plans (Brazil, Chile) are clear incentives but they need to focus quickly on

FTTH/B– Public telcos showed a strong dynamism in rollouts and migration in 2015 (Antel, ETB)

Forecasts up to 2020

FTTH/B LATAM market from 2015 to 2020

• More than 9.7 million subscribers for 41 million Homes Passed in 2020

2015 2016 2017 2018 2019 20200

100000020000003000000400000050000006000000700000080000009000000

10000000

TOTAL FTTH/B subscribers

2015 2016 2017 2018 2019 20200

50000001000000015000000200000002500000030000000350000004000000045000000

TOTAL FTTH/B Homes PassedSource: IDATE for FTTH Council LATAM Chapter

FTTH/B LATAM forecasts per main market


• The trend is those countries is less dynamic than we could expect one year ago: demographic characteristics, economic situation, market consolidation… can explain why the market is still embryonic there.• Barbados, Jamaica, Paraguay, Puerto Rico and Trinidad &

Tobago are the most relevant markets and will continue to lead the FTTH/B market in the region in 2020

• C&W’s acquisition of Columbus led to the emergence of a regional player leading the FTTx market in the Caribbean's, operating mainly under the Flow brand.

FTTH/B LATAM forecasts in the other markets1


1 Barbados, Bolivia, Dominican Republic, Grenada, Jamaica, Puerto Rico, Trinidad and Tobago, Paraguay, Peru, Venezuela

At end 2020:

=> 162,000 FTTH/B subscribers

=> ~584,000 FTTH/B Homes Passed

Thank you !

ContactValérie CHAILLOUDirector of Studies+33 467 144 [email protected]

ContactVirginie BLACHEREConsultant+33 467 144 [email protected]

ContactRoland MONTAGNEDirector, Principal Analyst+33 680 850 [email protected]

FTTH Council - Panorama LATAM by Roland MONTAGNE, IDATE

Technology

Transcript of FTTH Council - Panorama LATAM by Roland MONTAGNE, IDATE