Virus impact over each market - telecom operators, government agencies and regulators' responses - revised forecasts for the next 5 years.
Puerto Rico’s telecom market has been deeply affected in recent years by a combination of economic mismanagement and natural disasters, including two hurricanes which landed in late 2017 and an earthquake which struck in January 2020. The general destruction following the hurricanes led to a marked decline in the number of subscribers for all services, while straightened economic circumstances forced many people not to resume telecom services after these were restored. After some delay, the FCC in late 2019 issued an order relating to the release of funds to help rebuild telecom infrastructure.
Although Puerto Rico is a US territory it lags well behind the mainland US states in terms of fixed-line and broadband penetration. This is partly due to high unemployment rates (and consequently low disposable income) and poor telecoms investment in a market largely dominated by the incumbent Puerto Rico Telephone Company. The activities of the US-based telcos, including T-Mobile US, Sprint and AT&T continue to impact on the Puerto Rican market. This has recently been seen in these operators securing spectrum in the 600MHz, expanding the reach of LTE services and launching services based on 5G.
The Puerto Rico Telephone Company’s fixed-line market dominance was augmented following its acquisition by the largest wireless company in Latin America, América Móvil. In contrast, the mobile (cellular/wireless) market, with six network operators, has been experiencing more robust competition and growth. Although América Móvil’s Claro briefly took the lead from AT&T Mobility in terms of subscriber numbers, AT&T regained the top position following its acquisition of Centennial Communications. In early 2017 Sprint and Open Wireless agreed to merge their networks in a bid to offer better market competition by increasing their scale and combining spectrum holdings.
The acquisition by Liberty Global of the remaining cable TV operator Choice Cable, completed in mid-2015, created a monopoly player in this sector. Liberty Cablevisión, now wholly-owned by Liberty Global’s LLA division, is in a stronger position to capitalise on scale, and so provide improved services based on greater investment and on the use of technology based on the DOCSIS3.1 standard. Liberty Cablevisión has also become better placed in the bundled service market following LLA’s acquisition of AT&T’s wireless and wireline units in Puerto Rico. The deal is expected to complete by mid-2020.
BuddeComm notes that the outbreak of the Coronavirus in 2020 is having a significant impact on production and supply chains globally. During the coming year the telecoms sector to various degrees is likely to experience a downturn in mobile device production, while it may also be difficult for network operators to manage workflows when maintaining and upgrading existing infrastructure. Overall progress towards 5G may be postponed or slowed down in some countries.
On the consumer side, spending on telecoms services and devices is under pressure from the financial effect of large-scale job losses and the consequent restriction on disposable incomes. However, the crucial nature of telecom services, both for general communication as well as a tool for home-working, will offset such pressures. In many markets the net effect should be a steady though reduced increased in subscriber growth.
Although it is challenging to predict and interpret the long-term impacts of the crisis as it develops, these have been acknowledged in the industry forecasts contained in this report.
The report also covers the responses of the telecom operators as well as government agencies and regulators as they react to the crisis to ensure that citizens can continue to make optimum use of telecom services. This can be reflected in subsidy schemes and the promotion of tele-health and tele-education, among other solutions.
Puerto Rico Telephone Company, América Móvil, AT&T, Liberty Cablevision; OneLink Communications; T-Mobile; Open Mobile; Sprint PCS; Choice Cable.
As usual, you’ve done a splendid job of bringing an industry well and truly into the spotlight.
I think that without your input and passion, Australia would have barely scratched the surface of the benefits that can and will be achieved with the wholesale adoption of Smart Grid and Smart City concepts.
Glenn Latch, SKYZER TECHNOLOGIES
BuddeComm's strategic business reports contain a combination of both primary and secondary research statistics, analyses written by our senior analysts supported by a network of experts, industry contacts and researchers from around the world as well as our own scenario forecasts.
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