While we expect real GDP growth to slow over the medium term, attractive investment opportunities remain at the sector level, and a growing consumer story underpin our view that Peru will remain one of the most dynamic economies in Latin America in future. We therefore expect spending on electronic lifestyle products such as flatscreen TV sets, tablets and smartphones to rise as purchasing power increases and the cost of devices decreases. Peru is increasingly being targeted for its potential by foreign investors, leading to local partnerships and the establishment of company offices in Lima. We expect sales of consumer electronics devices to grow 12.9% in 2013, with many of the trends that drove consumer electronics spending in 2012, continuing to be factors. Notebook sales will continue to grow as the market is supported by government-backed affordable computer programmes that comprise an important market component. The entrance of Entel Chile into the mobile market and auction of 4G spectrum should boost to handset sales at the higher end of the market.
As incomes rise in Peru, the consumer electronics market is developing rapidly. Economic growth is relatively broad-based compared to some other regional markets, boosting consumption of devices such as notebooks, tablets, smartphones and flat-screen TVs. The primary weakness in the market is one found globally, that is, tablet sales are squeezing the growth of desktop and particularly notebook sales. More competition in the mobile telecoms sector and expansion in rural areas should boost the mobile handset segment.
Headline Expenditure Projections
Computer Hardware Sales: US$837mn in 2012 to US$943mn in 2013, +12.9% in US dollar terms. Growth momentum exists in desktop and notebook sales, but it is tablets that will outperform and take a growing share of the market.
AV Sales: US$912mn in 2012 to US$998mn in 2013, +9.4% in US dollar terms. Forecast in US dollar terms upwardly revised, with flat-screen TV sets expected to provide the most dynamic development.
Handset Sales: US$619mn in 2012 to US$734mn in 2013, +18.6% in US dollar terms. Smartphone and featurephones will continue to take a larger share of sales as incomes rise at the same time as average device prices are declining.
Key Trends & Developments
- In 2013, Peru's household PC segment will remain the main PC market driver due to a low household PC penetration rate, some distance behind that of Latin American neighbours such as Chile and Brazil. The low penetration means vendors can target first-time buyer and upgrade/replacement markets as a source of growth. While the overall PC market has a bright outlook, it should be noted desktop and notebook vendors are being squeezed by increasing competition from tablets, which are becoming more powerful, and more affordable now Android and Microsoft Windows based devices offer a genuine alternative to premium Apple products.
The start of digital terrestrial broadcasting is due to take place in 2014. The introduction of digital TV at the provincial level should stimulate demand for flat-screen TV sets in these markets. The first cities where digital TV services are expected to be available are Arequipa, Cusco, Trujillo, Piura, Chiclayo and Hancayo. Residents of Lima had access to eight additional TV channels by 2012.