Infrastructure upgrades, telecom law reforms and declining prices for data plans combined to make 2013 the year of the smartphone in Latin America. Last year, a record-breaking 35.4 million new users joined the smartphone market—a 45.3% increase—eMarketer estimates. And while it will be hard to beat last year’s expansion, smartphone uptake in the region will continue to post robust double-digit growth rates through 2017.
eMarketer predicts the base of smartphone users in Latin America will increase 28.3% in 2014, led by Brazil (36.0%) and the group of countries other than the top three regional economies—including Chile, Colombia, Peru and Venezuela, among others. Growth will continue to dwindle through 2017, mostly due to the swelling size of the market.
Diminishing growth, however, will not translate into a significantly lower number of new smartphone users in the region. eMarketer expects more than 30 million people to adopt smartphones each year through 2017. In absolute terms, Brazil and Mexico will be the largest contributors to Latin America’s expanding smartphone user base, adding 10.9 million and 6.1 million, respectively, in 2014.
Going forward, the sheer size of Brazil’s population, combined with the aggressive infrastructure upgrades needed ahead of the 2014 FIFA World Cup and the 2016 Summer Olympics, will boost growth to set it apart from any other market in the region. We predict that by 2017, there will be 70.5 million smartphone users in the country.
However, combined growth outside the region’s top three markets will overshadow Brazil’s stellar multiyear expansion. eMarketer predicts that the combined number of smartphone users in those nations will register a higher compound annual growth rate (27.0%) than Argentina (18.1%), Brazil (26.7%) or Mexico (24.3%) between 2012 and 2017, when total smartphone users outside the top three markets will approach 100 million.
Meanwhile, smartphone growth in Argentina is being hampered by policies aimed at reducing high-tech device imports and incentivizing manufacturers to increase domestic production. The measures have been far from productive and, unintentionally, have pushed smartphone prices up while tapering the variety of devices available to consumers.
Despite the hurdles, Argentina will remain the third-largest smartphone market in the region. Increases, while lower than those in any other country we produce forecasts for in Latin America, will remain in the double digits through 2017, when smartphone users will total 18.4 million.
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