Latin America smartphones expected to hit 200 million by 2018, study shows

Latin Americans are jumping into the mobile market at an exploding rate, deploying a projected 200 million smartphones by 2018.

That and other insights were revealed by Miami-based IMS and ComScore in the second edition of their annual study tracking regional trends in digital consumption and mobile apps.

“A very simple smartphone for $400 opens up a whole new universe. This is the beginning of something really big and confirms the opportunity,” said Gastón Taratuta, CEO, founder and partner of IMS, Latin America’s largest independent digital ad sales and media buying firm.

Taratuta, who started IMS in 2005 with $5,000, manages the company’s strategic direction and oversees all IMS sales teams. IMS’ services include the commercial representation for Twitter, LinkedIn, Waze, Spotify, FourSquare, EA and other social, geolocation and gaming and entertainment companies.

Some findings from IMS’ survey and research:

▪  About 90 percent of people connected to the internet in Latin America own a smartphone. Android is the preferred operating system.

▪  On average, Latin Americans own 17 apps. “The entry point for the Internet today is through applications,” Taratuta said.

▪  Those who are connected to the internet spend more than 37 hours on all connected devices weekly, versus about seven hours in front of the TV. Millenials spend about 12.7 hours weekly on their smartphones but only five hours on TV. “This is an important measure for advertisers. The new prime time is my own time,” Taratuta said. “It shows consumers are in control.”

▪  Heaviest internet usage is in Brazil, Colombia and Chile. About 98 percent connect via a smartphone; about half of those also connect via a tablet.

▪  About 66 percent of smartphone users in Latin America made a purchase from their devices within the past six months.

▪  Snapchat and Spotify saw strong engagement among millennials, compared to the majority of other apps measured.

What’s driving these results? Telecom companies have become aggressive in subsidizing smartphones and tablets, and prices are decreasing. Still, unlimited data plans are not common and more infrastructure and accessibility is needed in the region, Taratuta said. “We need a lot of things but it is growing exponentially.”

Today, IMS has about 470 employees and offices in 12 Latin American countries in addition to its Miami headquarters and New York office. IMS runs campaigns for 1,700 advertisers and 450 agencies in 16 markets. In just over 10 years, IMS has gone from $2 million in billings to about $150 million projected for this year. Taratuta said. Last year, Sony Pictures Television bought a majority stake in IMS.

IMS, whose management team stayed in place after the Sony acquisition, sees more acquisitions in its future and plans eventually to expand its market focus beyond Latin America, Taratuta said. The company currently is negotiating with some European companies, and it sees opportunity in southeast Asia, the Middle East and central Europe.

This story was originally published October 31, 2016 at 10:35 AM with the headline "Latin America smartphones expected to hit 200 million by 2018, study shows."