Perspectivas internacionales de sustituibilidad Voz fija y movil

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Sustitución Fijo Móvil

W. Swain 15 June 2012

© Copyright 2012

Agenda

Big Themes

General Framework

Trends in Fixed Voice

Trends in Mobile Voice

Conclusions

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New Mobile

Economy

Desktop Internet 1 Billion+ Units/Devices

PC 100 Million+ Units

Mobile Internet projected to exceed 10 billion units/devices by 2016

Opportunity Yankee Group predicts that the

total mobile service market (line subscriptions) will exceed $1 trillion by 2014

Yankee Group forecasts that the mobile connected devices market (phones, tablets and e-readers) will exceed $435 billion by 2014

Yankee Group predicts that revenues from mobile apps, cloud and advertizing will grow to $340 billion by 2014

Yankee Group forecasts the

growth in the value of mobile transactions worldwide will increase to $984 billion by 2014

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Text to Speech to Video

Increasing Bandwidth

Communication modes do not disappear but costs are transformed by technology and prices fall towards costs

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One-to-One To Many-to-Many Shared Personal Experiences

Source: Yankee Group U.S. Consumer Survey, 2011, 2012 Hispanic Respondents Only

As many Hispanic Smartphone Users Connect to Social Networks EVERY DAY as Make Voice Calls (58%)

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Defined Place to Any Place

Source: Yankee Group U.S. Consumer Survey, 2011 Hispanic Smartphone Respondents Only

2%

2%

3%

5%

13%

13%

16%

18%

27%

45%

90%

0% 20% 40% 60% 80% 100%

Public transportation

Other

Airports

Hotels

Internet Café

Public buildings

Private transportation

Out and about

School

Work

Home

Where Did You Use The Internet In The Last Month

(Ranked 1, 2,3)

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Smartphone Growth Driven by The Interaction of These Two Forces

1-to-1 to Shared Personal Experiences

Def

ined

Pla

ce t

o A

ny

Pla

ce

For many Latin Americans, a smartphone is their first personal internet device

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General Framework

Source: Yankee Group ConnectedView Mar 2012

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General Framework

0,0

20.000,0

40.000,0

60.000,0

80.000,0

100.000,0

120.000,0

2003 2004 2005 2006 2007 2008 2009 2010 2011

United States

Consumer Telephony Access Revenue Consumer Mobile Service Revenue


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General Framework

-20,0%

-15,0%

-10,0%

-5,0%

0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

30,0%

2003 2004 2005 2006 2007 2008 2009 2010

United States Year over Year Growth in Minutes

Interstate Switched Access Minutes of Use Carrier Minutes of Use

Source: FCC, Yankee Group ConnectedView, Yankee Group Mobile Carrier Monitor Mar 2012

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General Framework – Minutes Are Harder To See The Crossing Point – May Not Have Come

France Fixed and Mobile Minutes

Source: ARCEP Annual Report for Year 2010

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General Framework – Minutes Are Harder To See Crossing Point – Inconsistent Data

0

20000000

40000000

60000000

80000000

100000000

120000000

1400000001

98

0

19

82

19

84

19

86

19

88

19

90

19

92

19

94

19

96

19

98

20

00

20

02

20

04

20

06

20

08

Cellular mobile calls

National calls (local + long distance)

VoIP calls

France Fixed, Mobile and VOIP Minutes per EUROSTAT

Source: DataMarket.com June 2012

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General Framework – Why Do The Curves Cross?

Mobile Lines Are Personal – Fixed Lines Are Shared

“I want to call YOU, not your house/family/office”

Prepaid Mobile Opens New Socio-Economic Sectors

Calling-Party-Pays PLUS Prepaid Opens The Market Even Further

Mobile ARPUs Tend To Decline As Penetration Increases Whereas Fixed Voice ARPU Nearly Flat Delays Revenue Crossing Point

Mobile Voice Minutes More Expensive Than Fixed Voice Delays Minutes Crossing Point

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Global Trends in Fixed Voice – Some Growth, Especially in Emerging Markets But …

866917 937 952 960 970 965 953 961 971 981 991 1.000 1.010

0

200

400

600

800

1.000

1.200

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Consumer Fixed Telephony Lines (M)

Consumer Traditional Voice Consumer Non-Traditional Voice Consumer Voice Fixed Lines

Consumer Traditional (i.e. Telco) Lines Decreasing, Replaced by VOIP over

Broadband


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Global Trends in Fixed Voice

271,0 277,9

262,7 250,3 251,6 256,4

243,0 234,7 231,0 227,3 222,9 218,7 215,3 212,3

-

50,0

100,0

150,0

200,0

250,0

300,0

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Global Consumer Fixed Voice Revenue (USD M)

With Broadband Voice Given Away (Bundled) or Priced Low and VOIP Rates << Traditional, Voice

Revenues Fall Despite Growth in Lines


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Cord Cutting – US Attitude Survey

0%

10%

20%

30%

40%

50%

60%

70%

80%

18-19 20-24 25-34 35-44 45-54 55-64 65+

Pe

rce

nt

of

Re

spo

nd

en

ts

Age Group

US Cord Cutting Attitudes 1Q12

My Primary Phone Is Mobile

My Primary Phone Will Never Be Mobile

Source: Yankee Group US Consumer Survey Mar 2012

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Cord Cutting – US Attitude Survey

43%

2%

3%

3%

4%

39%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

It is a mobile phone

It will be replaced with a mobile phone within the next three months

It will be replaced with a mobile phone within the next year

It will be replaced with a mobile phone the next time I

move

It will be replaced with a mobile phone when I get a new bundle that does not include home phone service

It will never be replaced by a mobile phone

When Will You Replace Your Primary Fixed Phone With A Mobile Phone?

5%+ intention to "Cut the Cord" w/in 1 year is consistent with 5.8% decline we see/forecast

Source: Yankee Group US Consumer Survey Mar 2012

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Cord Cutting – As Reported by FCC – A More Restricted Definition

10%

12%13%

15%

16%

18%

21%

1,8% 1,7% 1,6% 1,9% 2,1% 1,7% 1,5%

0%

5%

10%

15%

20%

25%

Jan - Jun 2006 Jul-Dec 2006 Jan - Jun 2007 Jul-Dec 2007 Jan-Jun 2008 Jul-Dec 2008 Jan-Jun 2009

Fixed Mobile Substitution

Adults with Wireless Service Only

Adults with No Telephone Service

Source: Wireless Substitution: Early Release of Estimates From The Data from the National Health Interview Survey, January – June 2009). As Reported in FCC 15th Annual Report on Mobile Wireless Competition (2011)

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Global Trends in Mobile Voice

1.206 1.509

1.889

2.341

2.884

3.456

3.962

4.574

5.102

5.422 5.659

5.837 5.976 6.038

-

1.000

2.000

3.000

4.000

5.000

6.000

7.000

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Global Consumer Mobile Voice Lines (M)

Reaching saturation for Voice Lines. Further Mobile Growth will come from M2M and Mobile

Broadband


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Global Trends in Mobile Voice

282,4

339,9

370,1

405,6

458,9

491,5

458,5 452,7 469,3 461,3

444,8 428,3

414,5 401,2

-

100,0

200,0

300,0

400,0

500,0

600,0

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Consumer Mobile Voice Revenue (USD B)

Voice ARPUs continue to fall due to Regulatory and Competitive Action so Voice Revenues continue to

fall as well


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Voice ARPUs Fall “Sin Piso” (Except ZERO)

-

0,20

0,40

0,60

0,80

1,00

1,20

4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11

Real Voice ARPU (Seasonal Smooth) Indexed to 4Q07

Movistar COL (Telefonica)

Entel CHI

Movistar CHI (Telefonica)

Personal ARG

Movistar ARG (Telefonica)

Oi BRA

TIM BRA

Vivo BRA (Telefonica)

Movistar MEX (Telefonica)

Movistar PER (Telefonica)

Movistar VEN (Telefonica)

Movistar ECU (Telefonica)

Telcel MEX (America Movil)

Source: Yankee Group Mobile Carrier Monitor Mar 2012

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Voice ARPUs Are Not Falling Because of Decreased Usage

-

50,00

100,00

150,00

200,00

250,00

MOU = Average Voice Minutes of Use Per Month

Comcel COL (AMX)

Movistar COL (Telefonica)

Entel CHI

Claro CHI (AMX)

Movistar CHI (Telefonica)

Personal ARG

Movistar ARG (Telefonica)

Claro ARG (AMX)

TIM BRA

Vivo BRA (Telefonica)

Claro BRA (AMX)

Telcel MEX (AMX)

Movistar MEX (Telefonica)

Claro PER (AMX)

Movistar PER (Telefonica)

Movistar VEN (Telefonica)

Claro ECU (AMX)

Movistar ECU (Telefonica)

The issue is ARPM (Average Revenue Per

Minute) not OTT competition or

Penetration Growth leading to Marginal

Users or Growth in 2nd Lines

Source: Yankee Group Mobile Carrier Monitor Mar 2012

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Conclusions

Societal trends favor personal devices i.e. Mobile

Mobile is accessible to a broader base of society

2-5% of existing Fixed line customers “cut the cord” every year

Only bundling of Fixed Voice with Fixed Broadband prevents this from happening faster

Fixed Voice Revenues will continue to fall because of VOIP and migration to Mobile

Mobile Voice Revenues will continue to fall because of Regulatory and Competitive Action

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¡Gracias!

¿Preguntas? W. Swain

Managing Partner, C3 Comunicaciones SAS SVP Emerging Markets, Yankee Group [email protected] [email protected] www.MacondoTelecom.net @WSYGLA

mailto:[email protected]

mailto:[email protected]

http://www.macondotelecom.net/

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