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Some of the largest satellite providers in the industry are no longer waiting for Latin America to play catch-up with the rest of the international broadband community. While Latin America’s broadcast and broadband markets have displayed unique characteristics in service take-up, satellite executives strongly agree that the region is ready for next-generation broadband services and are investing in aggressive strategies to beat out competitors.
With a number of Ka-band satellites such as ViaSat-1 (ViaSat) and Ka-Sat (Eutelsat) now launched, the focus is whether satellite broadband could carve a niche in markets such as Europe and North America. Satmex CEO Patricio says he has no doubt that Ka-band will find a healthy place in the Latin American market.
“If you observe the various business cities in the Latin American region, many of these urban centers are spread out in a large area of several miles radius which will create a huge opportunity for offering high speed internet directly to its end users versus the traditional ADSL or cable Internet services,” said Northland. “ I expect both retail and business customers to be willing to pay a slight premium over terrestrial Internet services when the product offerings give a much higher internet high speed over terrestrial networks There is no doubt in my mind that the prospects for Ka-band are tremendous in the region.”
Like a number of satellite operators, SES is hopeful it can generate strong revenues in the region, and expects to launch another 2-4 satellites in the region beyond 2014.
SES CCO Ferdinand Kayser asserted that the strongest growth for SES will come from developing markets and in particular Latin America. Kayser went so far as to say that Latin America is now its most important growth market. According to SES’s market data, the optimism in the region seems well-placed.
"We expect the number of pay-TV subscribers to go from 44 million at the end of 2011 to close to 70 million by the end of 2015," says Kayser. "Interestingly, we also expect DTH growth to almost double in this timeframe going from 18 million subscribers at the end of 2011 to 34 million by the end of 2015."
Pradman Kaul, president of EchoStar subsidiary Hughes, highlights an award won by its Brazilian subsidiary during an auction conducted by Brazilian telecom regulator Anatel in August 2011. Hughes recently completed the prerequisites and executed the license agreement with Anatel this past May.
“We’re currently at an advanced stage of negotiations with potential partners for a joint venture to provide DTH service and are looking forward to expanding our business in one of the fastest growing regions in the world,” said Kaul. “Our subsidiary in Brazil has business that focuses on the enterprise sector and it is doing very well. We continue to look at the potential of starting a broadband consumer service business in Brazil, but at this stage have not made enough progress to publicly talk about our efforts there.”
Kaul also identified a potential for DTH growth in Brazil. “We have been exploring options with partnering and forming a joint venture,” said Kaul. “These options have been based around working with a partner with significant in country sales marketing distribution experience that we think will be nicely complemented by our strong set-top box and satellite systems knowledge.”
Discovery Networks International will take a cautious approach to doing OTT deals internationally compared to what it has done in the United States. Mark Hollinger, president and CEO, Discovery Networks International, highlighted Latin America as a hot market for the broadcaster.
“In Latin America, we probably have the best and broadest pay-TV growth. We love that kind of growth. Brazil and Mexico are seeing great organic growth. We also have a region we call CEEMEA (Central & Eastern Europe, Middle East and Africa), which is also seeing some strong subscriber growth. There is less subscriber growth in Asia, but we are growing in markets like India with additional channel launches or the ongoing professionalization of the industry and the consolidation of operators."
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