Latin American IPTV growth could be significant, barring regulatory roadblocks

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Although the line between the broadcasting and telecoms industries is blurring, regulations have not kept up and this has significantly impacted the growth of IPTV services in Latin America, new research from Business Monitor International has revealed. However, growth is in sight for the next-gen TV technology--if regulators get out of the way.

Conventional forms of pay-TV services, such as cable and satellite, continue to dominate the region. BMI estimates that there were less than 400,000 IPTV subscribers in the Latin America region at the end of 2010, but identified that there is significant growth potential in Latin America considering that the number of IPTV subscribers represents only a small percentage of the region's total population.

One caveat lies in regulatory issues. "However, we do note that there are mixed risks to our forecast scenario as the nascent industry is heavily dependent on how quickly regulations are amended to allow companies to expand products and services," the research company said.

BMI notes that positive developments have been made due to governments and companies' ongoing efforts to advance changes to existing IPTV regulations, albeit at a gradual pace that sometimes borders on the verge of stagnation. For example, Brazil's Bill PLC 116 (previously known as Bill PL 29) has been in the making for more than three years. However, at the time of writing, the set of regulations, which would allow Brazilian telecoms operators to offer IPTV services and enable greater participation in the country's pay-TV industry from foreign cable companies, has yet to be approved. Companies in other countries in the region are also facing similar challenges and are struggling to take advantage of Latin America's growing broadband subscriber base.

Generally, BMI sees high-speed broadband connections becoming increasingly ubiquitous around the world. This impressive growth momentum is largely fuelled by technological advancements, strong competition between telecoms operators and aggressive marketing campaigns. With a growing broadband subscriber base on operators' books, companies are looking to offer additional products and services that can capitalise on opportunities presented by broadband capabilities-- like IPTV. Telecoms operators are eager to venture into the pay-TV industry via Internet Protocol Television (IPTV) services as a means to boost revenues by increasing number of services delivered on companies' existing network infrastructure.

IPTV also has a competitive advantage in terms of added interactivity due to the technology's use of a two-way communication channel, which could help stimulate consumer demand and apply pressure on stakeholders to push through reforms. IPTV subscribers enjoy rich features such as customised programme schedules and video- and movie-on-demand services, which are normally limited on cable and satellite pay- TV services, BMI said.
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