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Report: Latin America Divided in Digital Convergence

10 Sep, 2010 By: Angelique Flores

In a recent report from Research and Markets, digital convergence in Latin American countries is all over the map.

The report, which covers developments in digital convergence, pay TV and the digital media market of Latin America and the Caribbean, reveals that convergence has become a popular solution for companies as a way to attract more customers as well as for regulators as a way to promote competition.

Although many cable TV networks are still analog, digital cable is gradually establishing a foothold in Latin America. One reason is cable TV piracy. Besides allowing for more advanced services, moving to a digital platform lets providers prevent signal theft, forcing households who want cable TV to become paying subscribers.

The launch of digital terrestrial TV in Latin America has been delayed by arguments over the standard to be adopted: USA’s ATSC, Europe’s DVB or Japan’s ISDB. Mexico, Honduras and El Salvador use the ATSC standard. Uruguay and Colombia have selected the DVB standard. Argentina, Brazil, Chile, Peru, and Venezuela use a modified form of the ISDB standard known as SBTVD. The remaining countries are still undecided.

Having a regional common system has clear advantages, such as boosting economies of scale when importing television sets. But the decision in most Latin American countries is influenced more by political reasons rather than by technical ones, based on each government’s relationship with the United States, Europe or Japan.

Other report highlights:

•    Argentina’s pay television market is the most mature in Latin America and is a world leader in terms of pay TV penetration, with more than 50% of homes subscribed to pay TV services. Cable TV comprises about 88% of Argentina’s pay TV market.
•    When it comes to new technologies, Chile tends to be Latin America’s pioneer. The region’s first triple play and IPTV services were launched in Chile. In September 2009, Chile adopted the Japanese standard ISDB-T/MPEG-4 for digital terrestrial TV services, with a 10-year period for analog TV to be completely replaced by digital TV.
•    In Mexico the three main cable TV providers have been incentivizing the purchase of triple play bundles of cable TV, broadband and telephone with great success. In early 2010 quadruple play appeared on the horizon as broadcasting giant Televisa received regulatory approval to acquire a stake in the Nextel de Mexico, while in the satellite TV market, Dish Mexico has had early success with rapid subscriber growth, and Axtel has also received regulatory approval to launch satellite TV and plans to begin offering triple-play services in 2010.
•    In Venezuela more than 50 companies offer pay TV services, yet five operators have 86% of the market.

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