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Colombia Broadband & Internet Access Services Market
Frost & Sullivan, March 2004
Government Support Sustains Market Growth
Government-run development programs such as Compartel and the Connectivity Agenda coupled with tax incentives for the purchase of personal computers have brightened the growth prospects of the Colombian Internet and broadband access market. The year 2004 is likely to witness a significant increase in Internet penetration as participants focus on tapping underserved sectors. In fact, those already having Internet connections - especially lower end businesses and residential heavy users - are migrating from dial-up connections to broadband access solutions. This means that introduction of broadband products is likely to provide a competitive edge to different tiers of service providers.
This Frost & Sullivan research examines the Colombian market for traditional (dial-up) Internet services and broadband access solutions such as asymmetric digital subscriber line (ADSL), cable modem, and others {integrated services digital network (ISDN), wireless, and satellite}. It also provides comprehensive information on the level of broadband evolution and competitive landscape, which includes Internet service providers (ISPs), telecommunications companies, and cable operators.
Removal of Regulatory Bottlenecks to Expedite Growth
Currently, certain regulations pertaining to telecommunications are pending government intervention and this is restraining market growth. One such issue is the de-segregation of wireline network (local loop unbundling) that could facilitate the entry of competitive local exchange carriers (CLECs) and second-tier ISPs in the broadband space that is currently dominated by incumbent telecom and cable operators. The permission to auction broadband wireless access licenses - which will allow new entrants and facilitate Internet access for remote users - is another key issue pending before the government. Such license auctions are also expected to reduce the geographic concentration in specific regions.
These much-awaited regulatory modifications could certainly fuel further penetration of broadband Internet. Considering the interest of the Colombian Government to promote Internet access across a broad spectrum of service technologies, regulatory modifications are expected to be customer-friendly and aimed toward expanding the Internet and broadband subscriber base, opines the analyst.
Expansion of Product Portfolio - the Key for Future Success
With cable operators continuing to dominate the broadband space and second-tier ISPs maintaining their focus on niche markets, the competitive landscape continues to be quite fragmented. This compels participants to broaden their product portfolio and offer additional value propositions, which could separate winners from losers in the broadband space. New product and service releases with special focus on the development of broadband access service suite along with aggressive marketing and pricing strategies is likely to assist participants in retaining and attracting new customers, concludes the analyst
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