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July 23, 2010

Prepaid mobile Internet to push operators’ market in Latin America: Pyramid

Operators need to expand their target market to generate revenues

By CBR Staff Writer

Mobile broadband, particularly prepaid mobile Internet has grown substantially in the last few years and is expected to continue the growth momentum in Latin America, according to a new report from Pyramid Research.

The report said that mobile operators need to expand their target market to generate service sales and, hence, revenues.

The research firm said that the prepaid mobile Internet service will grow and draw a substantial number of users in Latin America as it will be used not only by customers without fixed Internet in their home or office, but will also attract a number of occasional users, especially those who do not require full-time mobility for their connections.

The report revealed that the traditional mobile model, where operators mainly offered valued-added services to postpaid customers, neglected the mid-to-low-end of the population in emerging markets in its early stages.

Due to this, approximately half of the consumer spending in these countries are omitted due to the lower Average Revenue Per User (ARPU) among low-end and prepaid customers.

Vinicius Caetano, senior analyst at Pyramid, said: "In order to better address this overlooked market, operators will have to focus on services based on characteristics that are compatible with the majority of the population, including the prepaid model."

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