Peru Telecom - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

Key Highlights

• The Peruvian telecom market is propelled by government initiatives such as the National Broadband Plan and "ConectaRural," both designed to enhance connectivity, especially in rural regions. The extensive embracing of smartphones, coupled with the rollout of 4G as well as 5G networks, has significantly improved mobile internet access.
• The growing demand for digital services, such as mobile banking, e-commerce, and OTT streaming, highlights Peru's need for reliable, high-speed internet. This escalating demand is steering the nation's telecom infrastructure toward a phase of modernization and expansion, leading to increased service standards and bolstering market expansion.
• Peru's telecom market is experiencing a significant uptick, driven by the increasing adoption of social media. As more people turn to platforms like Instagram, Facebook, and Twitter, the demand for reliable high-speed internet is escalating. Consequently, telecom companies are ramping up their network infrastructure, embracing a mix of 4G and 5G technologies.
• The surge in social media usage is propelling data consumption, compelling telecom companies to introduce more competitive data plans. This not only enhances service quality but also spurs market growth, attracting a larger user base and strengthening the average revenue per user (ARPU). According to StatCounter, as of May 2024, around 64.22% of the Peruvian population used Facebook,
• As a crucial part of their strategic expansion activities, market players are taking rigorous action to enhance their consumer base. For instance, in July 2023, Harmonic announced that Claro Perú, a telecommunications service provider under the América Móvil Group, is expanding its utilization of Harmonic's CableOS Broadband Platform. This extension is specifically aimed at bolstering its fiber-to-the-home (FTTH) infrastructure, enabling the seamless provision of next-generation broadband services and 10G speeds.
• However, the growth of Peru's telecom market is hampered by infrastructural gaps in rural regions, complex regulatory structures, economic inequalities affecting affordability, and intensifying competition that is constraining prices. These challenges pose a substantial threat to the market's overall expansion.

Peru Telecom Market Trends

Growing Internet Penetration in Peru

• Urbanization and an expanding middle-income group are driving the demand for internet services in Peru, while infrastructure development is gaining momentum through public-private partnerships. Simultaneously, enhanced education and digital literacy are driving increased internet adoption in Peru, empowering a growing number of Peruvians to access digital platforms for education, work, and entertainment.
• Government initiatives, such as Peru's National Broadband Plan and "ConectaRural," are propelling the country's internet usage growth. These programs specifically target rural areas, aiming to bridge the digital divide. Simultaneously, the increasing prevalence of smartphones, coupled with the deployment of advanced 4G and 5G networks, is bolstering mobile internet accessibility nationwide.
• In July 2023, KKR, Telefónica Hispanoamérica, and Entel unveiled a strategic collaboration. Through this, KKR will take the lead by acquiring a controlling stake in PangeaCo. Additionally, it will also acquire the current fiber optic networks of both Telefónica del Perú and Entel Perú. The primary goal of this venture is to establish Peru's inaugural nationwide open-access wholesale fiber optics entity. The overarching aim is to enhance accessibility to fiber optic connectivity throughout the nation.
• The surge in internet usage in Peru, driven by increased smartphone adoption and more accessible data plans, has prompted telecom firms to invest heavily in advanced 4G and 5G technologies. These investments not only enhance network coverage and speed but also pave the way for novel services such as e-commerce, mobile banking, and online education, fueling the market's expansion. According to INEI (Peru), by the third quarter of 2023, internet penetration among Peruvians aged 19 to 24 surged to over 96%, showcasing a robust digital adoption trend. In contrast, the older demographic, those 60 and above, also demonstrated a significant digital presence, with over 44% utilizing the web.

Rising Demand for OTT and PayTv Services

• Increased demand for PayTV and Over-the-Top (OTT) services is driving growth in the Peruvian telecom market. As more consumers move from traditional cable TV to digital and streaming platforms, telecom firms are expanding their offerings to meet this evolving demand.
• The rise in OTT service demand, led by platforms like Netflix and Amazon Prime and local services, has significantly boosted internet usage. In response, telecom companies are ramping up investments to enhance their broadband infrastructure. This move seeks to meet the rising demand for streaming and enhance the quality of internet services, ultimately boosting the digital experience. According to INEI (Peru), during Q3 2023, 59% of Peru's internet users exclusively accessed the web via mobile phones. Additionally, around 11.3% accessed the internet from locations other than their homes, workplaces, or mobile devices.
• Furthermore, the growing demand for digital content is driving a significant uptick in content consumption. This shift is compelling telecom providers in Peru to overhaul their networks, preparing them to handle surging data volumes. Consequently, the increased interest in PayTV and OTT services is not only boosting subscription revenues but also leading the charge in reshaping and fortifying Peru's telecom infrastructure.
• In Peru, rising broadband speeds are fuelling a notable uptick in the demand for OTT and PayTV services. Faster connections enhance the viewing experience, enabling seamless streaming of high-definition (HD) and ultra-high-definition (UHD) content. According to Speedtest, as of November 2023, Peru boasted a median mobile internet download speed of 17.41 Mbps, with uploads reaching 11.97 Mbps. In contrast, fixed broadband services in the country surged ahead, boasting a median download speed of 93.92 Mbps, accompanied by uploads at 53.80 Mbps.
• Telecom providers in Peru are leveraging a growing consumer trend by combining high-speed internet with OTT and PayTV services. This strategic bundling not only boosts the value proposition for customers but also drives the expansion of digital entertainment, thereby strengthening the telecom market's foothold in the country.

Peru Telecom Industry Overview

• March 2024: The City of Peru partnered with Geneseo Communications Inc. to construct a fully buried fiber-to-premises (FTTP) network. This advanced network is designed to provide fast internet speeds, reaching up to 10 Gigabits per second with unlimited data use. Customers in Peru would be able to opt for streaming TV services. Additionally, they would enjoy sufficient bandwidth to support multiple devices, including those for home automation.
• June 2024: Redmond-based satellite company Project Kuiper and Vrio Corp., the parent company of DirecTV Latin America and Sky Brasil, signed a distribution deal. The agreement aims to provide internet connectivity services across seven South American nations, including Argentina, Brazil, Chile, Uruguay, Peru, Ecuador, and Colombia. The agreement aims to provide affordable, high-speed internet connectivity to approximately 383 million individuals, including around 200 million currently not connected to the internet, as per the World Bank's figures.

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