Latin America’s digital ecosystem expands with mobile operators

Latin America is experiencing an unprecedented wave of digitization thanks to the increase in smartphone penetration and resulting mobile data consumption. More than 2 million cell phones enter the Brazilian market every month!

A few days ago MobiXD (MobiExpanded) took place which marks a new strategy of mobile operators to expand their commercial borders through partnerships with companies in other sectors to offer digital services, such as in the areas of finance , health, education, security, games, publishing market, etc. There were themes around the Business model, new digital services offered by operators in areas such as finance, health, education, security, games, publishing, etc.

By 2025, data traffic should increase fivefold to reach 30 GB/month for each smart phone, according to GSMA Intelligence. This data consumption is also transforming the nature and volume of entertainment content consumed on affordable Android smartphones in the region.

Explosion of video streaming and games

The video in streaming is expected to overtake linear TV, with OTT subscriptions expected to reach over 110 million by 2024, according to Statista. A survey by consulting firm Netscribes shows that by 2021, the streaming market in Latin America is expected to reach $7 billion ($5.5 billion for video and $1.2 billion for streaming). sound). Brazil will continue to be the largest market in the region with 36 million of these subscriptions coming from the country. Netflix is ​​the dominant OTT player in the region, although the market share is expected to decline due to intense competition from regional players like Claro TV and Blim. Netflix is ​​expected to have 48.4 million by 2026, ahead of Disney+ (32.5 million), Amazon Prime Video (19.4 million), HBO Max (10.2 million) and Apple TV+ (8.1 million) . Claro Video, the streaming platform owned by Mexican phone company América Móvil, is expected to have 3.9 million subscribers by 2025.

Rise of digital payments

A fintech revolution has blossomed in Brazil’s largest and historically underbanked market, easing consumer adoption of digital payments. Launched in November 2020 by the central bank, Pix is ​​an instant payment system that allows consumers and merchants to receive money using a QR code. A year after its creation, the Pix has grown by 14,000% and, in January 2022, it was already used by 71% of the population in Brazil. The latest reports from the Brazilian Central Bank showed that Pix generated a monthly volume of 600 million BRL (over 100 million USD) in transferred funds.

In April 2022, 118 million people, or two-thirds of Brazilian adults, used the platform. According to Mastercard, a credit card giant, Brazil has reduced its unbanked population by 73% during the pandemic. The rapid adoption of Pix has resulted in a faster transition to digital payments, including instruments such as direct billing by theoperator. And Pix will pave the way for other countries in the region to emulate and adopt digital payments at scale, accelerating both mobile commerce and mobile content consumption.

OTT partnerships with mobile operators

Most content brands recognize that they may not have the prowess and scale of distribution of mobile carriers in new markets. And that’s why they rely on partnerships with carriers, especially when entering new markets.

Omdia estimates that Netflix had as many as 24 OTT bundling partnerships in Latin America in 2021, ahead of Amazon Prime Video with 19. América Móvil began bundling Netflix in mobile plans offered by its subsidiary Claro in Brazil in 2019, while Telefónica and Vivo have 14 similar partnerships in the same country alongside Oi (nine) and Claro Brasil (five). In Mexico, Totalplay has nine OTT partnerships, according to Omdia (most service integrations in pay-TV platforms), Televisa and América Móvil four each. Disney+ has been integrated into the regional services of operators such as Telmex, Izzi Telecom, Telcel.

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Latin America’s digital ecosystem expands with mobile operators


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