Connectivity in Latin America: Challenges and Opportunities for the Future
xFusion Global
Let Computing Serve You Better. A leading global provider of computing infrastructures and services.
Latin America is at a crossroads in terms of connectivity, the region is immersed in a process of technological transformation that requires collaboration and a joint effort between countries to advance towards greater and better connectivity. Telecommunications companies are under the influence of rapid technological advances, which require large investments to develop network infrastructures capable of meeting growing customer demands.
In 2023, the mobile industry in Latin America generated approximately 520 billion dollars, equivalent to 8% of the regional GDP. By 2030, this share is projected to increase to 600 billion dollars, reflecting the growth and importance of the sector in the regional economy. This economic boom underscores the need to continue investing in infrastructure and the development of emerging technologies to keep pace with demand.
Leaders in LATAM
Brazil, one of the largest economies in the region, has been leading the charge in implementing 5G networks, a technology that promises to revolutionize telecommunications. Along with Chile, Brazil is at the forefront of fifth-generation network deployments in Latin America. These investments not only improve connectivity, but also boost the region's competitiveness in the global arena.
Mexico's Federal Telecommunications Institute (IFT) has identified the deployment of 5G networks and fiber optic networks as its top priorities. Operators are focusing their business strategies on investing in these networks to meet the demands of the expanding digital ecosystem. According to recent surveys, 5G networks are considered the most important innovation in the sector, followed by cloud computing, Wi-Fi 6, and the Internet of Things (IoT).
On the other hand, Telconet, a leading Ecuadorian provider of integrated telecommunications, has deployed 35,000 km of fiber optics and more than 3,000 service points of sale throughout the country. It has also completed cross-border fiber optic deployment and data center interconnection in multiple countries, including Colombia, Venezuela, and Guatemala.
Mexico: Investments and Economic Challenges
In Mexico, the telecommunications sector, excluding broadcasting, generated US$397,111.39 million between January and September 2023, equivalent to approximately US$21,570 million. The four main fixed network giants in Mexico have made significant investments, totaling 23,614 million pesos during the first half of 2024. These investments have occurred in a challenging economic context, with an accumulated inflation of 1.7% and a 12.53% depreciation of the peso against the dollar, which has increased the costs for the development of telecommunications infrastructure.
These investments have allowed companies in Mexico to reach a market scale comparable with all of Bolivia and Ecuador, respectively, a subscription base larger than the total population of Uruguay and an access volume comparable with all of Chile.
Recommended by LinkedIn
Sustainability and Carbon Footprint Reduction
Sustainability and carbon footprint reduction have become crucial issues on the agendas of telecommunications organizations. It is not only about cost savings, but also about the growing importance of carbon footprint management in customer decisions, both in the B2B and B2C segments. The pressure to adopt more sustainable practices is shaping the way companies design and implement their strategies and operations.
The implementation of advanced technologies such as 5G networks can help reduce the carbon footprint in the long term, thanks to their greater energy efficiency compared to previous technologies. In addition, efficiency in data centers is improved through more effective cooling techniques and infrastructure optimization. Also, the use of artificial intelligence and data analysis to manage networks and data centers more effectively contributes to a reduction in energy consumption and, therefore, lower carbon emissions.
Technological innovation is a key catalyst for the development of the telecommunications sector and the digital ecosystem in general. Information and communications technology (ICT) companies are investing in technological developments to improve customer experience, increase efficiency and profitability, and optimize their operations. These advances not only facilitate better connectivity, but also open up new opportunities for growth and development throughout the region.
In short, Latin America is in a stage of significant transformation in the telecommunications field. Collaboration between countries, investment in infrastructure, and a focus on sustainability and innovation will be key to facing the challenges and taking advantage of the opportunities that arise on the path to more advanced and efficient connectivity.
Jacqueline Campos – xFusion LATAM