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Americas Market Perspective / Vol. 8, Issue 38, Edition 10
Pyramid Research, Inc, October 2008
Telefónica del Sur in Chile Launches Prepaid Broadband to Expand into Lower-Income Segments
In September 2008, Telefónica del Sur (TDS), a fixed operator in Chile focusing on the southern region of the country, launched a prepaid broadband offering with a speed of 1Mbps activated by a self-installed kit. The kit costs CLP$29,990 (around US$48.86) and includes 10 hours of navigation. Thereafter, users can buy airtime with prepaid cards from CLP$2,000 to CLP$9,000 ($3.26 to $14.66), where the hour is priced at CLP$200 ($0.33).
With the country enjoying one of the highest PC penetrations in Latin America, the author believes that prepaid broadband represents an opportunity for Telefónica del Sur to increase its customer base by penetrating lower-income segments that either cannot afford a multiplay package or whose patterns of usage do not justify a monthly contract. This is an important step in the expansion of broadband in Chile, and we forecast that the broadband market will generate $662m by 2013, up from $385m in 2008.