Telefónica, Claro Spice Up Costa Rican Market

CAMBRIDGE, Mass. -- State-owned ICE faces important challenges and opportunities as a result of the recent liberalization and entry of new competitors into Costa Rica’s mobile market, according to a new report from Pyramid Research (www.pyr.com).

Telefónica and Claro Spice Up Costa Rican Telecom Market analyzes the future of the Costa Rican market, now that Claro and Movistar will compete against ICE, in light of what Pyramid has seen in other markets where those players participate and how Pyramid expects ICE to respond. This report will also examine how consumers will be affected since the market will have just three players and not four as expected. Cases will analyze the success of a state-owned player and other new entrant scenarios in Central America.

Purchase this report online: http://www.pyramidresearch.com/store/ins_la_110209.htm?sc=LRPR021111_INSLA3.1

Download an excerpt of this report: http://www.pyramidresearch.com/downloads.htm?id=5&sc= LRPR021111_INSLA3.1

By the end of 2010, the majority of markets in Latin America saw population penetration exceeding 100 percent. “Against that backdrop, Costa Rica offers America Móvil (Claro) and Telefónica the opportunity to close a 30 point penetration gap, with advantageous economies of scale coming from several operations in the region,” says Jose Magana, Senior Analyst at Pyramid. “In addition, Costa Rica has a very small prepaid base (less than 30 percent of the total) and is in the early stages of the democratization of mobile data services, such as mobile Internet and mobile broadband,” he adds.

“The price paid by Telefónica and Claro for mobile licenses is consistent with what we have seen in other auctions in Central America, and suggests that both operators will seek a significant share of the market over the coming years to challenge current incumbent ICE,” explains Magana. “The outcome of the auction will result in mobile penetration exceeding 130 percent by 2015, mostly driven by prepaid subscriptions and mobile broadband. By the same token, Pyramid anticipates a rapid migration in the mid- to high-end base toward mobile Internet subscriptions, thus increasing the share of mobile data services over total telecom revenue,” he adds.

Telefónica and Claro Spice Up Costa Rican Telecom Market is part of Pyramid Research's Latin America Telecom Insider report series. Download an excerpt of this report: http://www.pyramidresearch.com/downloads.htm?id=5&sc= LRPR021111_INSLA3.1. This report is priced at $595 and can be purchased online (http://www.pyramidresearch.com/store/ins_la_110209.htm?sc=LRPR021111_INSLA3.1) or by contacting [email protected].

Pyramid Research