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Summary

Tigo El Slavador, a part of Millicom International Cellular, is one of the largest telecoms providers in El Salvador. It launched its GSM network in August 2004 and has never looked back, treating El Salvador as an important market to invest in. Its investments and acquisitions are strategically planned to enable it to become a vital part of El Salvador’s telecoms market.

A strong market for Tigo

Tigo launched GSM in El Salvador in 2004, followed by WCDMA in 2008. In the meantime it was focusing on building infrastructure to provide world-class services, and it acquired a 100% stake in leading cable TV provider Amnet Telecommunications Holding in 2008, under a strategy to strengthen its cable, broadband, and fixed telephony services in Central America.

Tigo started investing aggressively in 2012, with El Salvador proving to be among the best-performing markets and one of the best places to invest. It spent as much as $2m a week to run operations focusing on data capacity, 3G networks, satellite phones, and narrowband access. Tigo also started focusing on entertainment and mobile financial services, through Tigo Music and Tigo Money, respectively.

The company spent $50m to expand support for its digital lifestyle platform and infrastructure for data, and $4m to acquire technology to implement mobile number portability. This year, Millicom is investing $70m in digital-lifestyle-platform support and services and $100m in improving mobile network infrastructure, broadband Internet, and cable TV, including deployment of mobile base stations across the country, bringing its cumulative investment over the last three years to $300m.

According to the CEO of the El Salvador unit, Tigo is in the process of transforming from a telecommunications operator to an operator of digital lifestyle services, and all its investments are intended to provide the best quality services to subscribers. The Millicom group’s investment in El Salvador and its view of El Salvador as an important market has proved beneficial, with the operator having become the leader in terms of subscriptions. It is going in the right direction to become a market leader in other areas too.

Appendix

Further reading

Millicom Group Update, November 2014, TE0015-000219 (November 2014)

“Digital operator profile: Millicom,” TE0009-001296 (June 2014)

Author

Amit Kumar Rai, Analyst, North and South America

amitkumar.rai@ovum.com

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