Argentina 3G Licenses worth $207m According to Pyramid Research

date: August 23, 2001 - source: Pyramid Research

Given that Argentina will be the site of one of the first 3G auctions in Latin America, Pyramid Research recently developed a theoretical case study of a potential 3G licence winner, in this case Movicom-BellSouth Argentina.

Pyramid's financial analysis finds that the expected value of discounted cash flows for Movicom-BellSouth's 3G business amounts to $207m. If it wants to secure normal returns on its investment (20-30%), Movicom-BellSouth should not invest more than $175m to acquire a 3G licence.

Although the value established for Movicom-BellSouth's 3G licence seems minuscule when compared with the billions of dollars paid for similar spectrum in countries such as the UK and Germany, the price is in line with what some European countries have garnered.

Given the new, highly sceptical environment in which Movicom-BellSouth will be bidding for its licence, Pyramid Research has established a rather conservative base case scenario for its valuation. Although there is some downside risk, including Argentina's worsening economic position and a high dependence on voice for its overall revenues, there is also upside opportunity.

Movicom-BellSouth's ability to diversify its revenue streams away from voice and toward other services such as mobile Internet, mobile data, and, especially, mobile commerce, mobile advertising and debit-credit card transactions will serve to increase the value of Movicom-BellSouth's 3G licence.

Top Sellers at our online store

1.	NEC e606 on 3
2.	Orange Nokia 7250i
3.	O2 Samsung A800
4.	NEC e808 on 3
5.	Motorola A920 on 3

last updated: January 12, 2004

Visit our online store, click here

3 phones

3G Motorola A920
Available Now! Superb full colour touch- sensitive screen with a built-in digital camera for Video Calling.
Buy now from Free

M-Profits: Making Money from 3G Services
ISBN: 0470847751

This book discusses 3G services from the view of what is needed for the service to provide value to the user, what is the value proposition for the user, how will money be made out of delivering the service, and discussions on how revenue sharing propositions might work to benefit content providers and network operators. 3G operators should take note of this highly recommended book.

buy it UK | USA

3G Books to Read!

top