Tigo Panamá stepping up investments in fiber optics

Bnamericas Published: Friday, January 20, 2023
Tigo Panamá stepping up investments in fiber optics

Tigo Panamá announced that it plans to invest US$100mn this year to improve fiber optic coverage and modernize its mobile networks.

Although the investment is slightly lower than the annual average it has spent over the last four years, having disbursed a total of US$475mn in the period, the announcement implies that Tigo will step up investments in fiber optics.

Tigo will cover some 90,000 homes with fiber optics this year in Puerto Armuelles (Chiriquí), Colón, Panama City, the north of Penomé, the Azuero region and San Miguelito, according to news agency ANPanamá.

In a recent Fitch analysis of Tigo's fixed operation in Panama, the ratings agency estimated that the company's investments would be equivalent to 17% of revenues this year, a slight decrease from previous years.

Tigo is one of the biggest investors in Panama's telecom industry. According to estimates by regulator Asep, the telecommunications market in the country should end 2022 with total investments of US$276mn, while sector revenues are expected to reach US$1.12bn.

In 2019, Tigo's parent company Millicom invested more than US$2bn in Panama to acquire Cable Onda and Movistar.

“Low broadband penetration in Panama creates growth opportunities for the company,” Fitch said with respect to Tigo.

The agency noted that Tigo had nearly 900,000 homes passed with fiber as of the end of 2022.

Fitch expects the company to accelerate its investments to increase the number of homes passed in the coming years, although its focus will also be on having a greater number of homes connected to the network.

The agency estimated that it would add 80,000 homes passed in 2023, some 10,000 below the figure announced by Tigo, while in subsequent years, that figure is expected to dip to 20,000 additions per year.

"In contrast, the mobile market, despite recently announced industry consolidation, remains competitive, and growth opportunities are becoming more challenging as it matures," the Fitch report reads.

Fitch estimates that revenue-generating units (RGUs) in fixed services will grow by 4% between 2023-2024. Meanwhile, prepaid mobile subscribers will grow at a moderate rate, with postpaid increasing in "the mid-single digit zone."

Tigo mentioned that part of its investments in 2023 will be used to increase LTE capacity and increase coverage in new areas. The company assured that "the central part" of the network is already prepared for 4G.

According to Millicom data for the third quarter of 2022, as of end-September, the company had 2.4mn mobile users and 469,000 fixed income generating units.

The regulator Asep estimated that there were over 663,000 fixed broadband subscribers in Panama as of the end of 2022 and 6.9mn mobile lines.

Tigo's main competitor is Cable & Wireless Panamá. The country recently launched a tender for a third mobile operator to fill the spot vacated by Digicel.

Subscribe to the most trusted business intelligence platform in Latin America. Let us show you our solutions for Suppliers, Contractors, Operators, Government, Legal, Financial and Insurance.

Subscribe to Latin America’s most trusted business intelligence platform.

Other projects in: ICT

Get critical information about thousands of ICT projects in Latin America: what stages they're in, capex, related companies, contacts and more.

Other companies in: ICT

Get critical information about thousands of ICT companies in Latin America: their projects, contacts, shareholders, related news and more.

  • Company: Raylex Diginet S.A.  (Raylex Diginet)
  • Raylex Diginet S.A. is a Chilean company focused on telecommunications engineering offering solutions throughout the life of the project, from preliminary stages to commissionin...
  • Company: Ufinet Latam S.L.  (Ufinet)
  • The description included in this profile was taken directly from an official source and has not been modified or edited by the BNamericas’ researchers. However, it may have been...
  • Company: Honeywell Perú, S.A.  (Honeywell Perú)
  • Honeywell Perú S.A., a local subsidiary of US-based Honeywell International Inc., started operations in the country in 1998. The firm has an office in Lima which opened in 2008 ...
  • Company: Altán Redes S.A.P.I. de C.V.  (Altán Redes)
  • Altán Redes, whose headquarters are located in the City of Mexico, is an international consortium created in 2016 to design, operate and maintain the Mexican telecommunication p...
  • Company: Alignet S.A.C.  (Alignet)
  • Alignet is a Peruvian specialized company offering technology and security solutions for the payment industry and e-commerce sector. The company developed the EMV 3D Secure prot...
  • Company: Entel PCS Telecomunicaciones S.A.  (Entel PCS)
  • Entel PCS Telecomunicaciones (Entel PCS), a subsidiary of Chilean telco Entel, provides mobile communications service throughout the country. The firm has a 38% mobile subscribe...
  • Company: MVM Ingeniería de Software
  • The description included in this profile was taken directly from an official source and has not been modified or edited by the BNamericas’ researchers. However, it may have been...