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Latin America leads Global Mobile Growth

July 18, 2012

STORY HIGHLIGHTS
  • 98% of Latin American population has mobile cell signal.
  • New app enables Chilean farmers to recieve daily market updates via SMS.
  • Developing world is leading the way in creating new apps to promote new opportunities for human development.

Even in the remotest places in Latin America it isn't surprising to come across a local typing furiously on their top-of-the-range mobile. Farmers, businessmen, doctors or shopkeepers are connected by this device, which has managed to seduce a good part of the planet's population.

And making or receiving a call or text message in Latin America has never been easier. Around 98% of the region's population have mobile cell signal and 84% of LAC households subscibe to some type of mobile service. According to the new report 'Maximizing Mobile for Development,' the global figures are just as commendable: three-quarters of the world's population have access to a mobile phone, with 6 billion mobile subscriptions in use worldwide, offering a range of opportunities from banking to basic education to widening access to health information.  

In Chile, for example, farmers use SMS to help increase productivity. Subscribing to a messaging service supported by the Chilean government, small-scale farmers receive daily messages on market prices and weather reports, which can be accessed regardless of how sophisticated their handset or the speed of their network connection.

Mobile internet has exploded since 2005, accounting for 24% of all mobile subscriptions in Venezuela and 21% in Mexico, enabling previously under-served regions to get online. And Latin America's transition from 2G to 3G was praised by the report's authors, noting that many countries' operators leveraged existing bandwidth to be able launch 3G services before licenses had been awarded.

The report did warn, however, that many upper-middle-income countries within the region had not performed as well as expected within five year period. Argentina, however, bucked this trend, scoring highly for a dramatic increase in supply to match the increased demand for mobile technology, thereby maintaining a high level of universal access.

On average 81% of subscriptions in Latin America are pre-paid, compared with 36% in high-income countries and 96% in Sub-Saharan Africa. And with these subscriptions, the regional trend is to use the phone as a phone, averaging 141 minutes of talk-time a month in 2010. The only exception being Argentina, whose call usage dropped between 2005 and 2010, with the vast majority of users (97%) regularly using SMS to communicate.

In Nicaragua, the percentage of households with mobile access has increased by nearly 40%, whereas the average price of a handset has more than halved in the same period. However, with devices costing on average 14.3% of GNI per capita, they are still comparatively the most expensive in the region.

On the other hand, handsets in Panama cost just 1.5% of GNI per capita, making them one of the cheapest in Latin America. Here too phone sales have exploded with 204 mobile subscriptions per 100 people in 2010, almost four times higher than they were in 2005 - the highest in the region. And yet, the percentage of households did not see a similar increase, rising by only 20%, suggesting that sales were fueled by current mobile users rather than by new people entering the market. 

As handsets and mobile technology develop, cell phones have become much more than just communication tools, now offering a range of opportunities from banking to basic education to widening access to health information. And it has been the developing, rather than the developed, world who has been leading the charge.

Open Quotes

Mobile communications offer major opportunities to advance human and economic development – from providing basic access to health information to making cash payments, spurring job creation, and stimulating citizen involvement in democratic processes Close Quotes

Rachel Kyte
World Bank Vice President for Sustainable Development

A global trend

The level of growth in mobile technology is unmatched in the history of technology and, as handset prices fall, the report forecasts that mobile usage will continue to grow, expanding into ever more rural areas. This is only the beginning of the mobile revolution.

"Mobile communications offer major opportunities to advance human and economic development – from providing basic access to health information to making cash payments, spurring job creation, and stimulating citizen involvement in democratic processes,” said World Bank Vice President for Sustainable Development Rachel Kyte. “The challenge now is to enable people, businesses, and governments in developing countries to develop their own locally-relevant mobile applications so they can take full advantage of these opportunities.

This new report, the third in the World Bank’s series on Information and Communication Technologies (ICTs) for Development, analyzes the growth and evolution of mobile telephony, and the rise of data-based services, including apps, delivered to handheld devices. The report explores the consequences for development of the emerging “app economy”, especially in agriculture, health, financial services and government, and how it is changing approaches to entrepreneurship and employment