Peru telco investments up but revenue drops

Investments in the telecommunications sector in Peru grew 10.7% in January to September 2023, according to the latest report from regulator Osiptel, while revenue fell.

The investments by Telefónica, Claro, Entel, Viettel, Directv and Americatel rose from 1.51bn soles (US$407mn) in the first nine months of 2022 to 1.67bn soles in the same period 2023, according to the watchdog.

“This in a context in which operating companies have been registering greater investments in the deployment of fiber optics – necessary for the transmission of data and provision of broadband internet services – and the improvement of the mobile network – and the expansion and improvement of operations related to 4G and 5G technologies,” says the regulator's report.

The two operators contributing the most investments, Claro with 46.3% of the total and Entel with 23.1%, were also the ones that increased their capex the most with growth of 12.2% and 21.8%, respectively.

Telefónica ranked third, with 18.9% of total investments, followed by Viettel (8.9%), Directv (2%) and Americatel 0.8%.

Viettel was the only operator that cut investments – by 17.2% from 180mn soles to 149mn.

However, in June, the Vietnamese telco was the only winner of the 4G spectrum auction held by investment promotion agency Proinversión. The company committed to making investments close to US$600mn in exchange for the spectrum license.

In September Claro led the mobile market with 12.4mn lines, followed by Movistar with 11.3mn, Entel with 9.3mn and Viettel with 7.6mn.

Movistar leads the fixed internet market with 1.46mn connections, followed by Claro with 884,714, WIN with 436,093 lines and WOW with 320,194 connections. The rest of the accesses are divided between Entel (68,194) and Fiberlux-Fiberline (45,840), among others.

REVENUE

During the first nine months of 2023, income generated by all telecommunications companies fell 3.9% to 14.3bn soles compared to the same period the previous year, driven by mobile services and fixed internet service, which grew 1.8% and 5.6%, respectively. 

The migration to postpaid and the advance of fiber optics boosted the sector's turnover.

Another line of business that recorded higher revenues was data transmission and circuit rental (+4.4%).

Income from equipment sales fell 20% in a context of lower imports of smartphones.

Billing for pay-TV services dropped 11.9% in the period due to the migration to streaming platforms.