Argentina ends 2006 with record-breaking e-figures

THIS YEAR ends down under in Argentina with notorious growth of everything e-related. According to reports published in the local press, broadband usage, e-commerce, and spending in electronics gadgets all grew considerably during 2006.

First, overall residential internet use in the land of Tango, soccer, and Euroland tourists grew only 4.1% comparing Dec 2005 to Dec 2006 figures, a figure which now amounts to around 13 million users, informed the official statistics bureau two weeks ago. But the most spectacular growth came from the migration of dial-up accounts to broadband ones -the vast majority of which will end up with cable-modem connections from local media conglomerate Clarin and ADSL from one of the two incumbents that hold a monopoly on the local loop. The number of broadband users hence grew an outstanding 76.8 per cent comparing late-2005 to late-2006 figures. The number of business grade internet connections grew by 9.4 per cent this year.

Local E-commerce on the rise
The local business chamber of e-commerce players, CACE, informed that 2006 ended with a record breaking success and a year-to-year growth rate over 100%. According to the group, local e-commerce -that is, shopping from local .com.ar web sites- grew over $10B pesos compared to $4.8B pesos. In dollars, the figures translate to roughly $3.3B greenbacks for 2006 vs. $1.6B in 2005. The estimated number of users of e-commerce is put by CACE at five million people, who bought something over the Interweb during '06.

According to a published study, 84% of the polled plan to use the Net to buy something on the End-of-Year shopping craze, 77 per cent used the Interweb to research for summer vacation destinations, and around 60 per cent will use the Web to book a destination, travel or tourist service online.

Sales of electronic appliances, gadgets soar
According to local paper Clarin -Spanish link- the local chamber of the retail sector informed that sales this Yuletide season grew by over 25% compared to 2005 figures, marking a "record of the last ten years". According to La Gaceta, and citing INDEC bureau stats for the first half of 2006, sales of electronics equipment like DVD players, digital cameras, TVs, Plasma screens, LCDs and the like grew by 134.8% compared to the first half of 2005. They cite modest salary increases, the offering - once again - of small personal loans by banks - the vast majority dedicated to household appliance purchases, and even the World Cup as factors which contributed to this spectacular growth.

Mobile sales aim for the sky
Mobile operators CTI - owned by Mexico's Carlos Slim of TelMex fame, Personal - owned by Italy's Telecom group, and Movistar - part of Spain's Telefonica behemoth - also reported record-breaking sales, 44.1 per cent higher than the year before. The number of active mobile phones in the country thus grew to 30.2 million units.

According to the operators, actual sales exceeded the players' expectations by 30% on CTI, by 10% on Telefonica's Movistar, and by 35% on Telecom's Personal, and the high end mobiles with MP3 playback and digital cameras were among the favourites, according to the firms.

More upbeat news galore
If you are still not flooded under the pile of meaningless figures, always-unhappy right wing newspaper La Nacion surprised this correspondent by actually pointing out at some other positive figures of Argentina's economic landscape. According to the paper, the volume of long distance international phone calls grew 15.5% year-to-year measured in minutes billed. On a colour note and totally unrelated to IT or telecomms, travel by air - something that this correspondent does not enjoy - grew 5.7% comparing 2006/2005 figures. Believe me, it wasn't because of me.

Local loop unbundling, the Elephant in the Room
Fixed wireless never really made a sizeable dent for residential customers. WiMax, due to pricing strategies, remains largely restricted to business grade leased line links with CIR and at a high cost. The unbundling of the local loop is still the Elephant in the Room. The two incumbents managed to divert the public's attention by demanding access to video broadcast services -something currently banned to them under the current law-. It is ironic that in a city of skyscrapers like Buenos Aires, with a high ratio of customers per block, the choices for affordable symmetric broadband remain limited to a few areas where small players like IPlan has laid its own fiber/copper network. And it's not uncommon nowadays to see more and more antennas and CPEs for WiMAX leased links, all for the privilege of bypassing the expensive incumbents.

In the end, I come to the conclusion that very few people understand LLU and the benefits that unbundling would mean for the customers. Judging from the conversations I had a handful trade shows I attended this year, I really doubt even a few managers I spoke to from new players like TelMex really knew what I was talking about when I talked about LLU, or the implications of unbundling to their business. One of them who should remain nameless even asked me if unbundling would mean that they would have to share their infrastructure too with the incumbents -the answer is obviously no, only the incumbents which hold a dominant position into the marketplace should have to share the local loop with new players under LLU regulations. I think a training/education expedition from the knowledgeable staff at Ofcom, telling local pundits, players, legislators and regulators about the UK's unbundling experience would be really nice, to spread the gospel of its advantages and perhaps help BT's business in the country as well. I know the chances are very slim, but hey, let me dream of good things to come, as it's the end of the year.µ

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