The digital economy of Latin America is one of two halves: on the one hand there has been a surge in the number of smartphone users and in mobile broadband penetration driving the digital economy, yet on the other there are several challenges which stem from the paucity of quality digital infrastructure.
Yet LatAm is one of the hottest markets around for telecoms, ecommerce and value-added services – and DOCOMO has published a white paper detailing the opportunity and how to go about entering the market, based around analysis of third party research and data, as well as its own experiences and expertise.
For instance, a report by GSMA predicts that, by 2025, 75% of Latin America’s population will subscribe to mobile services, closing the gap with the average for developed markets, which stands at 87%.
Latin America – including the Caribbean – had 442 million unique mobile subscribers by mid-2018, accounting for two-thirds of the continent’s population. This number is expected to continue growing strongly in the years to come, albeit at different rates across different markets, and the region is forecast to contribute 10% of all new subscribers globally between now and 2025.
The significant increase in the number of subscribers will be largely driven by major markets such as Brazil, Mexico and Colombia, which have penetration levels close to the regional average.
The Latin America opportunity
This is a huge opportunity.
According to DOCOMO’s white paper – titles Understanding the digital ecosystem in Latin America – the region is poised for the next level of growth in its digital economy and improved access to information and digital services will raise the standard of living for the region’s people.
Governments across LatAm recognise this potential and are working towards fostering environments more conducive to manifesting this growth. There are challenges, sure – not least that of affordability and lack of infrastructure, macro-economic pressures and regulatory issues – but there is still potential.
And the more new entrants come to these markets, the faster these issues will be resolved, says the report. It points to how Facebook and SpaceX are both investing heavily in now high-altitude internet access projects to leverage the market potential for telecoms services on the ground in Latin America. As these projects attract further foreign investment, so the market will take off – if you’ll pardon the rocketing pun, Mr Musk.
DOCOMO Digital is the mobile commerce-related business of NTT DOCOMO group. We partner with over 200 carriers and 300 merchants globally. Our portfolio solves the challenges of scale, regulation and complexity for telecom operators, merchants and payment service providers. Our “enabler” platform allows telecom companies to participate in the growing mobile commerce ecosystem. With our new state-of-the-art payment API, merchants get a single payment-agnostic gateway into new markets. Alternative Payment Methods like mobile wallets can now offer access to international merchants to their consumers, with DOCOMO Digital’s API and payment settlement facility.
DOCOMO Digital is a wholly owned subsidiary of one of the world’s largest telecom companies – NTT DOCOMO listed on the Tokyo Stock Exchange.