Mobile telecommunications have recovered their customary procyclical path with respect to the evolution of the economy as a whole, growing 5.4% in annual terms during the third quarter of 2022 (3Q-2022), measured by operator revenues. This increase is mainly attributable to the evolution registered by the mobile services component, not by the sale of equipment.
Income. Since the second half of 2021, the annual growth of revenues generated by the sale of services grew more than the market as a whole and 3Q-2022 was no exception.
The growing social mobility has generated a greater demand for ubiquitous connectivity whose growth was 12.3%, which more than offset the contraction of smart devices (10.0%). This component of income from the sale of smartphones registers a continued trend in the red that now reaches the fifth consecutive quarter.
Lines. At the end of 3Q-2022, a total of 137.2 million lines were recorded, 6.7% more than the same quarter of the previous year, the highest annual expansion in just over a decade.
From this accounting, the proportion of lines by modality is practically the same as in the previous quarter, 82.9% correspond to the prepaid sub-segment and 17.1% to the postpaid one. On an annual basis, the migration of the structure from postpaid to prepaid stands out, which changed 0.8 percentage points (pp).
Consumption of Services. The average income of the operators per mobile user per month (Average Revenue per User or ARPU for its acronym in English) measures the consumption of services in monetary terms and stood at a level of $137.4 pesos per user per month in the 3Q-2022 , 1.9% higher than that registered during 3Q-2021. It practically remained at the same level as the previous quarter, with only a slight increase of 48 cents.
It is foreseeable that the entry of new technologies and services, the migration to 5G networks, as well as the greater consumption of services will drive the ARPU of the market up. However, the decline in purchasing power offsets the positive impact of these factors.
Forecast to the End of 2022. The drop in the sale of smartphones is mainly attributable to the fragility of the economy and employment, as well as the growing preference for acquisition channels other than the operators themselves. This continues to exert a negative weight on the mobile market, however, its impact is likely to fade at the end of the year. Meanwhile, it is anticipated that the number of users will maintain its upward trend and that their consumption will increase, circumstances that will boost service revenues, thus offsetting the performance of equipment revenues.
As has happened in previous years, regardless of the general dynamics of the mobile market and the macroeconomic shocks, the growth of mobile lines is expected to continue during the end of the year (4Q-2022), based on the growing importance of these services for Mexicans. The main factors underlying this positive forecast are greater coverage by operators, growing consumption of services by consumers and an increase in the number of connected devices.
Good weekend offers and holiday promotions are expected to boost the acquisition of equipment and consequently the corresponding income for mobile operators. This, coupled with the positive trajectory of the services component, would boost market revenues at the end of the year.
@ernestopiedras
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