The Chilean unit of Spains Telefónica has launched IPTV services in Santiago, its first in Latin America. Telefónica Chile has invested US $20 millionn into network upgrades and equipment purchases to facilitate the IPTV rollout.
The service is limited to the wealthier neighborhoods in the northeastern corner of Santiago.
The neighborhoods chosen for the rollout are the only areas where the network has sufficient bandwidth to handle 6Mbt channels needed to deliver the service. There are plans to expand the service to other parts of the city in 2008.
By the end of 2007, Telefónica expects to have some 3,000-5,000 IPTV subscribers. However, in the near term the service is only a complement to Telefónica's existing digital TV and satellite services.
The IPTV service offers video on demand, with some 240 hours of content available. Every month around 20% of that content will be updated.
At the end of May its competitor, VTR had a 71% share of the pay TV market, down from 77% at end-2006, according to Telefónica. The incumbent has had digital and satellite TV services for one year and at the end of May had a 14% market share with 156,547 clients, a 66% increase compared to the end of 2006.
This is a small beginning in IPTV for Telefónica in Chile. Don't expect dramatic growth. The broadband network there is not ready to support IPTV on a broad basis. This is also Telefónica's third pay TV service and will have to compete for resources within the company.
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