Almost before the ink was dry on the prediction, Chile has immediately followed Argentina and this week endorsed the selection of ISDB-T as a HD and mobile TV broadcast protocol for the introduction of digital TV.
Both decisions come on the back of raised shipments of ISDB-T devices in Brazil which have recently ramped up, after a decision in principle to use the Japanese technology was taken over two years back. We predicted in April 2008 that this could be a slam dunk for the entire Latin American continent for ISDB-T and so it is turning out,
A month ago Argentina’s president Cristina Kirchner committed her country to ISDB-T after the Brazilian government introduced stimulus funding for build out in Brazil, a process that is still continuing. These two countries using ISDB-T will mean that handsets that are used in one country will be able to pick up One Seg TV signals in all three. Also HD TV sets provisioned for one will work in the others.
It has taken over two years for Brazil to convince Japanese and Chinese manufacturers, both of TV sets, and the one-seg portable devices, that it was worthwhile setting up manufacturing operations in Brazil in order to avoid the 85% tax duties there. Now they have ready created a regional capability that will be rewarded by larger volumes in at least three territories.
We estimate that it is still early days for One Seg handset shipments in Brazil and that around 20,000 devices a month is the current install rate. In Japan the rate reached 2 million devices a month in 2007 and has now settled back to 1.5 million a month with the overall handset business ailing in Japan due to the economic climate, down almost 30%.
We understand that Chinese imports from ZTE and Huawei are picking up a lot of the Brazilian business, which could eventually give them both a disproportionately high market penetration in South America.
Brazil has around 130 million mobile subscribers out of a population of 190 million, so potentially over perhaps a 5 year time span this is an even bigger market than Japan, all on its own. Japan has 127 million people around 114 million mobile owners and now ships 85% of its handsets with one-seg. We estimate that there are 64 million one-seg devices in Japan already.
If you add Argentina to that equation there are another 40 million people, but almost 100% of the population has a phone, and the ISDB-T one-Seg opportunity seems to get bigger and bigger.
There remains Uruguay, Peru, Venezuela, Bolivia and Paraguay which may still go down the ISDB-T route. Uruguay has given lip service to taking DVB-T and DVB-H, but may change its mind.