Giants in the Playhouse

May 1, 2011

Three major telecom companies are slugging it out in Central America. With growth starting to plateau, the player with the best technology may prove the winner.

Keywords: Adam Williams América Móvil Telefónica

by Adam Williams
The sight of indigenous women carrying cell phones is becoming increasingly common in parts of Central America. In the last five years, the number of cell phone users there has risen from around 12 million to over 39 million, an increase of over 225%, according to telecommunications market research firm Pyramid Research. The total regional population of the six Spanish-speaking nations (excluding Belize) is around 41 million, meaning there are now almost as many cell phones as people in Central America.

According to José Magaña, a telecommunications analyst specializing in Central America at Pyramid Research, the boom in cell phone use in the region has been the result of market privatization. During the last 15 years, each Spanish-speaking Central American country has shed state-run monopolies to allow private telecommunications corporations to enter national markets.

Three private companies - Mexico’s América Móvil, Luxembourg-based Millicom, and...

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