DESPITE the fact that the Caribbean has small markets with limited potential for growth, telecommunications is set to continue being one of the region’s major growth industries.

This is according to the latest report by Communication Proprietary Ltd released this week by Research and Markets on the Caribbean.

This report, now in its 11th edition, covers the trends and developments in the Caribbean telecommunications market through analysis of the mobile, Internet, broadband, and cable TV sectors.

According to the report, telecommunications players in the region are continuing to show continued investor confidence in the sector.

The report identified LIME and Digicel as having shown considerable confidence in the sector through their willingness to invest in their fixed-line and mobile networks and so encourage consumer use of high-end data services.

The report suggested that LIME and Digicel were banking on the migration of their customers from 2G to 3G and 4G networks, and from basic broadband services to comprehensive bundled offers, as the avenues from which they would derive their future revenue streams.

According to the report, fixed-line broadband subscription is projected to continue year-on-year growth in the major Caribbean markets with Barbados expected to grow to 58,000 subscribers this year from 56,000; Trinidad and Tobago to 195,000 subscribers from 145,000; and the Dominican Republic to 435,000 from 361,000.

Encouraging tourism growth projections for this year also bode well for the telecoms industry, according to the report.

“Regional economic growth has been hampered by continuing pressure on tourist arrivals, principally from the USA and Europe. Nevertheless, some markets have reported a slow yet steady increase in arrivals since 2011. This will be crucial for telcos during 2012 and 2013, particularly in the mobile sector which is considerably supported by tourist spend,” stated the report.

It added that mobile penetration in the region approaches 70 per cent, with tourists accounting for a considerable proportion of SIM cards sold and active SIM penetration is likely to be more 80-85 per cent.

The report added that continuing regulatory developments have also focussed on the few remaining monopolies with a view to encouraging market competition, which will contribute to telecommunications continuing to be one of the Caribbean region’s major growth industries.