Global entertainment and media outlook 2009–2013

Latin America
Regional Summary
Overview
● Overall spending on entertainment and media in Latin America will rise from $57 billion in 2008 to $73 billion in 2013, making
it the fastest-growing region with a compound annual increase of 5.1 percent.
● Latin America was the fastest-growing region in 2008 with a 10.1 percent increase. We expect the recession to lead to a 1
percent decline in 2009, but this will be followed by accelerating increases and a return to double-digit growth in 2013.
● Over the five-year period, there will be double-digit compound annual growth in Internet advertising and Internet access
spending, and a 9.2 percent compound annual gain in video games. TV subscriptions will expand at a 6.5 percent
compound annual rate, and filmed entertainment will grow by 4.5 percent compounded annually.
● The remaining segments will average less than 2 percent annually, and recorded music will be lower in 2013 than in 2008.
● Overall advertising will grow by 1.9 percent compounded annually to $23 billion in 2013 from $21 billion in 2008, partly
fuelled by compound annual growth of 17.4 percent in Internet advertising.
● Total consumer/end-user spending will rise to $32 billion in 2013 from $27 billion in 2008, a 3.9 percent compound annual
increase.
● Brazil and Mexico will remain the dominant countries throughout the forecast period, with at Brazil increasing at a CAGR of
4.6 percent to $32.9 billion, and Mexico by 4.3 percent compounded annually to $17.4 billion. In combination, they will
account for 69 percent of total E&M spending in Latin America in 2013.

Internet Access: Wired and Mobile

● Over the next five years Latin America will be the fastest-growing region for Internet access spendingalbeit from a
relatively low basewith a 14.3 percent compound annual increase to $17.4 billion in 2013 from $8.9 billion in 2008.
● Spending rose at double-digit annual rates during the past five years, but will dip to single-digit gains during the next two
years as the economic environment weakens.
● However, spending will then return to double-digit annual growth during 2011–13 as the economy recovers.
● Infrastructure upgrades, penetration into rural areas, and triple-play packages will drive broadband spending.
● With wired dial-up access spending continuing to decline at a 14.1 percent compound annual rate, wired Internet access
spending will rise at 11 percent compounded annually, growing to $14.2 billion in 2013 from $8.4 billion in 2008.
● The introduction of high-speed mobile wireless networks will stimulate demand for mobile access.
● As a result mobile access will be the fastest-growing component from a small base, expanding from $518 million in 2008 to
$3.2 billion in 2013, a 44 percent compound annual increase.

Internet Advertising: Wired and Mobile

● Latin America will remain the smallest region for Internet advertising but the fastest-growing, expanding at a 17.4 percent
CAGR to $1.5 billion in 2013 from $660 million in 2008.
● Broadband growth and infrastructure upgrades will expand the platform for wired Internet advertising, which will continue to
grow throughout the forecast period, albeit slowing to single digits in 2009 and 2010.
● An emerging mobile Internet access market and the launch of a mobile TV market will expand a developing mobile
advertising market, which will continue to grow at double-digit rates throughout the forecast period from a low base.
● Wired Internet advertising will increase to $1.3 billion in 2013 from $631 million in 2008, a 15.4 percent compound annual
increase.
● Mobile advertising will rise to an estimated $185 million in 2013, up 44.9 percent on a compound annual basis from $29
million in 2008.
● Brazil is the largest market in the region, and will also be the fastest-growing, with its overall wired Internet and mobile
advertising market rising at a CAGR of 19.1 percent to break through the $1 billion barrier in 2013.

Television Subscriptions and License Fees

● Television Subscriptions and License Fees in Latin America will grow by 6.5 percent compounded annually to reach $13
billion in 2013 from $9.5 billion in 2008.

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● The economic slowdown will cut into near-term penetration growth and subscription spending. But subscription spending
growth will rebound later in the forecast period, taking it to $12.7 billion in 2013, a 6.2 percent compound annual gain over
the five years.
● Growth in digital cable and the introduction of IPTV will fuel a small VOD market, which will double to $40 million in 2013, a
14.9 percent increase compounded annually.
● Infrastructure upgrades will lead to mobile TV launches, and mobile television will accelerate from a low base to reach $175
million by 2013.
● Brazil, Mexico and Argentina were the three largest television subscription and license fee markets in Latin America in 2008,
and they will retain these positions through 2013, all growing at mid-single digit CAGRs.
● Chile will be the fastest-growing country during the next five years, with a projected 8 percent compound annual increase,
fueled by an expanding IPTV market.

Television Advertising
● Latin America will be the fastest-growing television advertising market over the next five years, with a compound annual
increase of 1.4 percent to $13.1 billion in 2013 from $12.2 billion in 2008.
● The economic slowdown will lead to a decline in television advertising in 2009 and 2010, followed by an accelerating
recovery in 2011–13, mainly fueled by multichannel advertising growth.
● Expanding multichannel audiences will boost multichannel advertising, which will rise to $1.8 billion in 2013 from $1.1 billion
in 2008, a 9.8 percent growth rate compounded annually.
● Terrestrial advertising, which accounted for 91 percent of the market in 2008, will fall through 2009 and 2010 before
recovering to reach $11.4 billion in 2013, a 0.4 percent compound annual increase from 2008.
● New channels and increased funding will help to enhance terrestrial advertising once economic conditions improve.
● Brazil and Mexico will remain the largest television advertising markets in Latin America through the five-year forecast period,
accounting for 79 percent of the market in 2013.

Recorded Music
● The recorded music market in Latin America will decline at a 0.4 percent compound annual rate to $938 million in 2013 from
$957 million in 2008.
● In North America and Asia Pacific, spending on digital formats will surpass physical in 2011, while in EMEA and Latin
America, physical will remain the largest component through 2013.
● In each region, gains in digital will ultimately offset continued declines in physical formats. Asia Pacific will be the first region
to experience this turnaround, with spending beginning to increase in 2011, followed by Latin America in 2012 and North
America in 2013. In EMEA, spending will stabilize in 2013.
● New music sites and 3G launches will drive spending on mobile phone distribution, which will rise to $314 million in 2013
from $153 million in 2008, a 15.5 percent compound annual increase.
● An expanding broadband universe will expand the market for legitimate Internet distribution, which will generate $148 million
by 2013, rising at a 28.6 percent compound annual rate from $42 million in 2008.
● Digital distribution overall will reach $462 million in 2013, growing at an 18.8 percent compound annual rate from $195
million in 2008.
● Piracy and growth in legitimate digital formats will lead to declines in physical distribution, which will fall from $762 million in
2008 to $476 million in 2013, a 9 percent decrease compounded annually.
● Brazil and Mexico will remain the largest markets throughout the forecast period. Following declines in the early years, the
region’s overall recorded music market will turn round in 2012, and the markets in all countries will be stable or rising by
2013.

Filmed Entertainment
● Filmed entertainment in Latin America will total $3.1 billion in 2013, up from $2.5 billion in 2008, representing a 4.5 percent
gain compounded annually.

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● Support for local productions will sustain box office spending, which will increase from $1.3 billion in 2008 to $1.7 billion in
2013, representing compound annual growth of 5 percent.
● Rising DVD penetration will boost home video throughout the five-year forecast period.
● Home video sell-through will advance at a 4.4 percent compound annual rate to $862 million in 2013 from $694 million in
2008.
● Home video rental spending will total $533 million in 2013, a 3.2 percent increase compounded annually.
● Overall home video will average 4 percent compounded annually from $1.1 billion in 2008 to $1.4 billion in 2013.
● High piracy rates in the region have prevented legitimate digital download and online rental subscription services from
becoming established, and these will remain an insignificant component of the market through 2013.

Video Games
● Latin America is the smallest regional video games market, and is projected to grow to $2.0 billion in 2013 from $1.3 billion
in 2008, a 9.2 percent compound annual gain.
● Continued strength in handheld games and the growth of the next generation of consoles will stimulate the console game
market. Console/handheld games will grow by 6.6 percent compounded annually from $745 million in 2008 to $1 billion in
2013.

● Limited competition will enable the PC game market in Latin America to expandthe only region where it will do so. The PC
game market is expected to reach $164 million in 2013, up from $126 million in 2008, a 5.4 percent compound annual
increase.
● Broadband growth will fuel an emerging online game market, which will expand from a low base of $46 million in 2008, to
reach $163 million in 2013, growing by 28.8 percent on a compound annual basis.
● Growth in the number of wireless subscribers will help spur the region’s wireless game market, which will increase from
$327 million in 2008 to $569 million in 2013, growing at 11.7 percent on a compound annual basis.
● Advertising in video games is expected to double from a low base during the forecast period, growing at a 15.4 percent
compound annual rate from $23 million to $47 million in 2013.

Consumer Magazine Publishing

● In the Latin American consumer magazine market, near-term declines will be more than offset by gains during 2011–13, and
spending will rise by 1.3 percent compounded annually to $3.6 billion in 2013 from $3.4 billion in 2008.
● Consumer magazine publishing in Latin America will decrease by 6.8 percent during the next two years under the impact of
the economic downturn, before rebounding by 14.3 percent during the subsequent three years. This will make it the only
region to register compound annual growth over the five years.
● The declining economy will lead to near-term decreases in print advertising, which will fall by 8.7 percent during the next two
years, followed by a 15.1 percent rebound to $1.4 billion in 2013, giving a 1 percent compound annual increase from $1.3
billion in 2008.
● Broadband household growth will stimulate a small digital advertising market, which will rise from $13 million in 2008 to $58
million in 2013, a 34.9 percent compound annual increase from a low base.

● Falling discretionary income will depress circulation spending during the next two years, butlike print advertisingit will
then rebound during the subsequent three years. Magazine circulation spending will total $2.1 billion in 2013 from $2 billion
in 2008, a 1 percent compound annual increase.

● Argentinathe region’s second-biggest market after Brazilwill record the best performance in nominal terms during the
next five years, with a 3.2 percent compound annual increase. Over the forecast period, we also expect gains in Brazil,
Mexico, and Venezuela in later years to offset the near-term declines.

Newspaper Publishing
● The Latin American newspaper publishing market will be the best-performing region during the next five years, with a
projected 1.9 percent compound annual increase from $6.8 billion in 2008 to $7.5 billion in 2013. Declines during the next
two years will be more than offset by renewed growth later in the forecast period.

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● The recession will reduce the amount of print advertising during the next two years. As a result, print advertising will fall by a
cumulative 9 percent from 2008 to 2010 before increasing by 14.5 percent during the subsequent three years, averaging an
0.8 percent compound annual growth rate for the entire forecast period from $3.7 billion in 2008 to $3.9 billion in 2013.
● Broadband growth will boost digital advertising for newspaper publishers. This will total an estimated $183 million in 2013,
growing at a 29.1 percent compound annual rate from a small base.
● Total newspaper advertising will rise by 1.5 percent compounded annually from $3.8 billion to $4.1 billion, making Latin
America the only region where overall newspaper advertising revenues will increase.
● Falling incomes will cut into unit circulation growth and circulation spending in the near term, but these will rebound later in
the forecast period. Over the five years, circulation spending will expand at a 2.5 percent compound annual rate from $3
billion in 2008 to $3.4 billion in 2013.
● Brazil will remain the region’s dominant market through 2012, growing at a CAGR of 2.3 percent. But second-placed
Argentina will narrow the gap, registering the region’s fastest growth with a CAGR of 4.5 percent.

Radio and Out-of-Home

● The radio and out-of-home market in Latin America will expand at a 1.6 percent compound annual rate to $2.0 billion in 2013
from $1.9 billion in 2008.
● The worldwide economic crisis will take its toll in 2009 and 2010 on radio and out-of-home advertising in Latin America.
● The Internet, which competes with radio in other markets, has historically been less of a threat in Latin America because of
low penetration rates. With broadband penetration now surging, the Internet is becoming more attractive to advertisers, who
will start to shift their resources to the Internet, thereby cutting into radio advertising.
● As a result, radio advertising will be flat over the five years, increasing by a modest, 0.3 percent compounded annually to
$1.2 billion in 2013 from a comparable level in 2008.
● The elimination of many billboards in Brazil is leading to a slowdown in out-of-home advertising in the next two years,
although it will recover from 2011 and reach double-digit growth in 2013.
● As a result, out-of-home spending will increase at a 3.5 percent compound annual rate over the five years, to $859 million in
2013 from $723 million in 2008.

Consumer and Educational Book Publishing

● The consumer and educational book publishing market in Latin America will grow at a 0.7 percent compound annual rate to
$4.9 billion in 2013 from $4.8 billion in 2008.
● Spending will decrease by 3 percent during the next two years but will then recover during the following three years,
rebounding by 6.6 percent to register a modest rise over the five-year period.
● The adverse economy will lead to near-term declines in consumer book sales, but the subsequent recovery will see these
grow from $2.18 billion in 2008 to $2.23 billion in 2013, a 0.5 percent compound annual increase.
● A growing school-age population will lead to a rebound in the educational book market when the economy improves.
● Educational books will expand by 0.8 percent compounded annually, reaching $2.7 billion in 2013 from $2.6 billion in 2008.
● There is no material electronic book market in Latin America.
● Brazil will remain the dominant market throughout the forecast period, accounting for 69 percent of total regional spending in
2013, followed by Mexico, with Argentina a distant third.

Business-to-Business Publishing
● Latin America will be the only region to see an increase in spending on business-to-business publishing during the next five
years, with a rise to $3.9 billion in 2013 from $3.8 billion in 2008, representing growth of 0.8 percent compounded annually.
● Spending will decrease by 6.6 percent during the next two years and then expand by 11.1 percent during 2011–13, more
than regaining the lost ground.
● Declining economic activity will lower spending on business information during the next two years. As a result, business
information will total $1.8 billion in 2013 from $1.7 billion in 2008, growing at a 1 percent compound annual rate.

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● Cutbacks in ad spending will lower directory advertising during the next three years. However, strong growth in online
directory advertising will enable total directory advertising to increase at a 0.2 percent compound annual rate over the five-
year forecast period, from $891 million in 2008 to $898 million in 2013.
● Trade magazines will be adversely affected by the economic downturn in the near term. However, strong growth in
advertising on trade magazine Web sites, and more modest growth in print advertising over the five-year period, will see
total trade magazine advertising rise to $311 million in 2013, a 1.8 percent compound annual increase. With circulation
spending growing at a 0.4 percent annual rate to $195 million in 2013, the total trade magazine market will expand at a 1.2
percent compound annual rate to $506 million in 2013.
● Falling employment will lead to decreased spending on professional books during the next two years. However, a
subsequent recovery will see spending on professional print books advance at a 0.5 percent annual rate to $758 million in
2013 from $738 million in 2008.
● Total business-to-business advertising will rise from $1.18 billion in 2008 to $1.21 billion in 2013, a 0.6 percent compound
annual increase.
● Total end-user spending will rise at a 0.8 percent compound annual rate to $2.7 billion in 2013 from $2.6 billion in 2008.

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