Argentina internet: Broadband takes off

FROM THE ECONOMIST INTELLIGENCE UNIT

Latin America’s broadband market, after a three-year slump, is now growing strongly. This is most evident in Argentina, which ended 2004 with 431,548 broadband users, for an increase of more than 102% compared with December 2003. Projections for 2005 reflect at least another 50% rise in users. Figures for the first quarter indicate a 93% jump in broadband users compared with the same period last year. These growth rates are not sustainable, says telecoms consultancy Pyramid Research (US), but state initiatives and cheaper PCs will undoubtedly help sustain the extension of broadband into many parts of the country that have not yet seen it.

The broadband Internet market’s pickup is only partly due to Argentina’s recent economic recovery. A number of other factors are undoubtedly contributing, with declining PC prices at the forefront. This has been the result partly of the Economy Ministry’s initiative to ensure the addition of 10m more PCs throughout the country over the next five years. 'Programa Mi PC', which is also supported by Microsoft and Intel (both US), will spend US$4.5b in this period to subsidise the cost of PCs and ensure that lower and middle-income sectors of the Argentinian population can purchase home computers on a system of credit for as little as US$16 a month.

Argentina: Internet and broadband penetration
	2003	2004e	2005f	2006f
Internet users (m)	4.15	5.12	6.28	7.21
Internet users (per 100 people)	10.8	13.3	16.1	18.3
Broadband subscriber lines (‘000)	235.8	432.9	669.0	859.3
Broadband subscriber lines (per 100 people)	0.62	1.12	1.71	2.18
Personal computers (stock per 1,000 pop)	105.2	110.8	116.8	124.2
e = Estimate.
f = Forecast.
Source: EIU Market Indicators & Forecasts.

SOURCE: Business Latin America (full publication)