Fixed line holds two-thirds of broadband market

A new report covering Jamaica and more than 25 other countries in the region has found that Latin America and the Caribbean (LAC) lags behind the world in broadband penetration.

Two years ago, LAC was seen to be the fastest-growing Internet market, but last year, broadband coverage was still only 6.3 per cent compared to 8.0 worldwide, according to a press release on the new Latin American Broadband and Internet Market Report done by Research and Markets (R&M).

Still, the lag of 21 per cent was better than the 2008 estimated gap of 27 per cent.

The researchers also expect broadband penetration to rise to "at least 6.8 per cent" across the region this year.

Fixed broadband, or ADSL technology, still dominates, accounting for two-thirds of the market, while cable modems were said to have been making inroads.

The advances of cable modem access are due, the researchers said, to the popularity of triple-play services - voice, Internet, video - delivered over hybrid fibre-coaxial, or HFC, cables.

The "slow uptake" of broadband in the region overall, they said, could be attributed to several factors, including:

Limited bandwidth;

High prices due to insufficient competition;

Low PC penetration;

Insufficient fixed-line structure to carry ADSL;

Poverty and unequal income distribution;

A lack of economies of scale;

Regulatory hurdles.

"On the positive side, bandwidth has been increasing in most countries, leading to higher speeds and lower prices," said the R&M release.

Wireless and satellite broadband are also widely available, particularly for corporate customers.

WiMAX can be found in most countries - including Jamaica, where Digicel launched its residential service in September mostly to good reviews. But the researchers said that regionally, the technology has attracted only a small number of subscribers.

Mobile broadband remains a nascent market that still lags well behind ADSL, but up to two years ago, reportedly had some five million subscribers.

Broadly, however, the researchers were upbeat on the broadband and Internet markets in the year ahead.

"Given the region's general economic indicators, there is ample room for expansion," said R&M. "Although the situation varies considerably from country to country, the region as a whole should be a fertile ground for broadband investment in 2010-11."

business@gleanerjm.com