Millicom International Cellular Stock

Millicom International Cellular S.A. provides cable and mobile services.

The company, through its main brands Tigo and Tigo Business, provides a wide range of digital services in nine countries in Latin America, including high-speed data, cable TV, direct-to-home satellite TV (DTH and when it refers to DTH together with cable TV, it uses the term pay-TV), mobile voice, mobile data, short message service (SMS), Mobile Financial Services, fixed voice, and business solutions, including value-added services (VAS). The company provides services on both a business-to-consumer (B2C) and a business-to-business (B2B) basis, and it has used the Tigo brand in all its markets.

The company offers the following principal categories of services:

Mobile, including mobile data, mobile voice, and Mobile Financial Services to consumer, business and government customers; and

Cable and other fixed services, including broadband, pay-TV, content, and fixed voice services for residential (Home) customers, as well as voice, data and value-added services and solutions to business and government customers.

The company provides both mobile and cable services in eight countries: Bolivia, Colombia, El Salvador, Guatemala, Honduras, Nicaragua, Panama and Paraguay. In addition, the company provides cable services in Costa Rica.

Additionally, the company has a large portfolio of infrastructure across Latin America, including in its Honduras joint venture, which includes 10,900 towers, 12 Tier III data centers and 193,000 kilometers of fiber. The company also has an Mobile Financial Services business, Tigo Money, which is curently operating in Paraguay, Guatemala, El Salvador, Bolivia and Honduras. In 2022, the company also began preparations for the introduction of its Mobile Financial Services business in Panama.

The company conducts its operations through local holding and operating entities in various countries, which are either its subsidiaries (in which it is the sole shareholder or the controlling shareholder) or joint ventures with its local partners.

As of December 31, 2022, the company provided services to 40.6 million mobile customers (45.7 including its Honduras joint venture), including 20.9 million 4G customers, which it defines as customers who have a data plan and use a smartphone to access its 4G network. As of December 31, 2022, the company also had 4.8 million customer relationships with a subscription to at least one of its fixed services. This includes 4.1 million customer relationships on the company’s HFC and FTTH networks and 0.5 million DTH subscribers. The majority of the remaining customer relationships are served by the company’s legacy copper network.

Strategy

Underpinning the company’s strategy is management’s assessment that penetration rates for both mobile and fixed broadband services in its markets are low relative to penetration rates in other markets globally, and that these have potential to increase over time. The key elements of the company’s strategy include expanding its HFC and FTTH networks; and increasing its commercial efforts to fill the broadband networks.

The company drives customer adoption by expanding its range of digital services and aggregating third-party content, as well as some exclusive local and international content, enabling it to differentiate itself from its competitors.

The company’s cable network deployment is also critical to help prepare it for convergence of fixed and mobile networks and services, a trend it expects will accelerate with the deployment of 5G technology in the future.

The company’s mobile networks continue to experience rapid data traffic growth, and it is very focused on making sure that incremental traffic translates into additional revenues.

The company’s 4G networks enable it to deliver high volumes of data at faster speeds in a more cost-efficient manner than with 3G networks. More data-capable smartphone devices, particularly 4G/LTE, with a strong device portfolio and strategy to enable the company’s customers to use data services on the move. More compelling data-centric products and services to encourage the company’s consumers to consume more data, while maintaining price discipline.

The company’s strategy is to selectively evolve its portfolio into ICT-managed services to avoid excessive fragmentation and operational risk, while building the Tigo Business brand and differentiating itself through its service model and frontline execution. The company focuses on convergence also reflects its expectation that future network deployments, such as 5G, will require significant fiber network capacity and capillarity, as well as the spectrum, radio and other components of mobile network.

The company focuses on transforming and evolving its customer experience and operations through the digital innovation of products and channels to empower its customers to do everything digital first with the variety of offerings that is available in its digital ecosystem: Mi Tigo, Tigo Money, Mi Tienda, eCare, ONEtv, TigoSports and others.

Through Tigo ONEtv, the company’s next-generation user experience platform, provides an advanced pay-TV entertainment experience for its customers, with sophisticated personalization options and recommendations, seamless integration of content across linear and on-demand offerings, and robust multi-screen capabilities. We also provide a valuable digital user experience through its Mi Tigo App for prepaid, postpaid and home customers, and its Tigo Money app for mobile financial services.

The company is committed to providing the best customer service and experience possible in all of its markets. The company has placed customer experience at the center of its decision-making as it continues to innovate across business lines and countries. The company’s focus has been simplifying how customers interact with its by implementing integrated, digital-first customer service channels.

The company has also adopted and deployed a net promoter score (NPS) program, designed to strengthen its customer-centric culture, and NPS is one of the metrics used to measure management performance under its incentive compensation plan.

Services

The company’s services are organized into two principal categories: Mobile and Cable and other fixed services. In addition, the company sells telephone and other equipment, consists of mostly of mobile handsets.

Mobile

In its Mobile category, the company provides mobile services, including mobile data, mobile voice, short message service and Mobile Financial Services, to consumers, business, and government. Mobile is the largest part of the company’s business and generated 57% of consolidated service revenue (and 59% of its Group Segment service revenue) for the year ended December 31, 2022.

The company provides Mobile services in every country where it operates, except Costa Rica. As of December 31, 2022, the Group had a total of 40.6 million Mobile customers, and 45.7 million Mobile customers including its Honduras joint venture.

Mobile Data, Mobile Voice and Short Message Service

The company provides its mobile data, mobile voice and short message service services through 2G, 3G and 4G networks in all its mobile markets. 4G is the fourth generation of mobile technology, succeeding 3G, and it is based on Internet Protocol (IP) technology, as opposed to prior generations of mobile communications which were based on and supported circuit-switched telephone service. The company’s 4G networks enable it to offer services to its customers, such as video calls and mobile broadband data with richer mobile content, such as live video streaming.

The company’s ongoing deployment of 4G networks, the launch of its 5G network in parts of Guatemala City, Guatemala in 2022, and industry planning for the future deployment of 5G further support this evolution to more data-centric usage.

The company provides its mobile data, mobile voice and short message service services on both prepaid and postpaid bases. In prepaid, customers pay for service in advance through the purchase of limited-duration data packages, and they do not sign service contracts. Among various options that its customers can choose from, the company offers packages that typically begin with a data allowance, and include a combination of voice minutes and short message service, with expiration dates varying in length from one or more days, up to a few weeks or months. In postpaid, customers pay recurring monthly fees for the right to consume up to a predetermined maximum amount of monthly data, voice usage and short message service. In most cases, new postpaid customers sign a service contract with a typical length of one year.

Mobile Financial Services

The company provides a broad range of mobile financial services, such as payments, money transfers, international remittances, savings, real-time loans and micro-insurance for critical needs through its (Mobile Financial Services) MFS App, Tigo Money. Tigo Money allows the company’s customers to send and receive money, without the need for a bank account. As of December 31, 2022, the company provided (Mobile Financial Services) MFS to 5.7 million Tigo and non-Tigo customers, including its Honduras joint venture. 9.8% of its mobile customer base were Tigo Money users as of December 31, 2022. It complements the company’s Mobile and Cable product offering and increases customer satisfaction and loyalty, increasing ARPU and reducing customer churn. The company is in the process of separating its Tigo Money business from its core telecommunications service operations in order to facilitate the development of new financial and strategic partnerships aimed at accelerating Tigo Money's growth and enhancing its value creation potential.

Cable and Other Fixed Services

In its Cable and other fixed services category, the company provides fixed services, including broadband, fixed voice and pay-TV, to residential (Home) consumers and to government and business (B2B) customers. Cable and other fixed services generated 41% of the company’s consolidated service revenue for the year ended December 31, 2022.

Home

The company’s fixed-service residential customers (a customer relationship generate revenue for it by purchasing one or more of its three fixed services, pay-TV, fixed broadband, and fixed telephony. The company refers to each service that a customer purchases as a revenue generating unit (RGU), such that a single customer relationship can have up to three RGUs in countries where it is permitted to sell all three services.

The company provides Home services mainly over its HFC and FTTH networks, but it also offers pay-TV services via its DTH platform and broadband services using FWA and copper-based technologies in some markets. Although most of the company’s customers choose to receive broadband speeds on average of 100 Mbps, the HFC networks it is rolling out are based on DOCSIS 3.0 and allow it to offer speeds of up to 400 Mbps on its current infrastructure, which gives it scope to significantly raise its customers’ broadband speeds over time. As the company retires analog channels over time, its HFC network infrastructure allows it to offer faster speeds. The company has rolled out DOCSIS 3.1 in some markets, which allows it to offer speeds of up to 1 Gbps. The company has also begun to deploy FTTH in some markets as part of its greenfield fixed-network expansion, and it includes FTTH network and customer metrics as a subset of its HFC network and customer metrics.

The company provides Home services in every country where it operates. As of December 31, 2022, the Group had 4.8 million customer relationships, of which 4.1 million were connected to the company’s HFC and FTTH networks, and it had 9.5 million RGUs, including 3.8 million broadband RGUs on its networks.

The company provides its Home services on a postpaid basis, with customers paying recurring monthly subscription fees. In most markets, the company offers bundled fixed services, such as its triple-play offering of pay-TV, broadband internet and, where possible, fixed telephone. On average, the company’s Home customers typically contract more than one fixed service from it. In some markets, the company also markets its services on a convergent basis, bundling both fixed and mobile services, to a very small portion of its total customer base.

B2B Fixed

The company offers fixed-voice and data telecommunications services, managed services and cloud and security solutions to small, medium and large businesses and governmental entities. The company offers B2B fixed services in all of the markets in which it operates.

The company has already deployed approximately 193,000 kilometers of fiber in its markets, including its Honduras joint venture, and it is expanding product portfolio to deliver more value-added services and business solutions, such as cloud-based services and ICT managed services. In 2019, the company inaugurated a Tier 3 certified data center in Honduras, which further strengthened its ability to better serve SMBs and large enterprise customers that require robust infrastructure and redundancy to achieve their own operational efficiency goals and meet business continuity needs. The company has also established partnerships in the area of hypercloud, virtualization and Internet of Things, to capture the growth in the adoption of these technologies and helps its customers accelerate their digital transformations.

Markets

The company operates in a single region, Latin America. The markets the company serves are Bolivia, Colombia, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama and Paraguay. The company provides Cable and other fixed services in each of these markets, and it provides Mobile services in each market except for Costa Rica.

Millicom Group

The company provides mobile services in seven countries in Latin America. As of December 31, 2022, the company had a total of 40.6 million Mobile customers.

As of December 31, 2022, the company’s Cable business had a network that passed 12.9 million homes. The company has significantly increased the coverage of its fixed networks largely in response to demand for high-speed fixed broadband services. As of December 31, 2022, the company’s HFC and FTTH networks passed 12.6 million homes.

Bolivia

The company provides Mobile and Cable and other fixed services through Telefónica Celular de Bolivia S.A., which is wholly owned by the Millicom Group.

Mobile: As of December 31, 2022, the company served 3.7 million subscribers and were the second largest provider of Mobile services in Bolivia, as measured by total subscribers.

Cable and Other Fixed: As of December 31, 2022, the company was the largest provider of broadband and pay-TV services in Bolivia, as measured by subscribers, and it had 720,000 customer relationships. The company offers broadband services through HFC and FTTH, and it provides pay-TV primarily through HFC, FTTH, and DTH in Bolivia.

Colombia

The company provides Mobile and Cable and other fixed services in Colombia through UNE, in which it owns a 50% plus one voting share interest and Colombia Móvil S.A., which is a wholly owned subsidiary of UNE. The company operated in Colombia through Colombia Móvil S.A. since 2006 and acquired its interest in UNE, with which it had previously co-owned Colombia Móvil S.A., via a merger in 2014. On May 25, 2021, the company’s minority partner in Colombia, EPM, announced that it intends to pursue a potential sale of its stake in its Colombian operations.

Mobile: As of December 31, 2022, the company served 11.5 million subscribers and were the third largest provider of Mobile services in Colombia, as measured by subscribers.

Cable and Other Fixed Services: Tigo is one of the principal digital cable operators in Colombia. As of December 31, 2022, the company were the second largest provider of pay-TV and broadband internet services in Colombia, as measured by subscribers, with 1.8 million customer relationships. The company has been investing to expand the reach of its fixed network and to upgrade its copper network to HFC and FTTH. In July 2022, the company announced wholesale network access agreements with Empresa de Telecomunicaciones de Bogota (ETB) and Ufinet, giving Tigo customers access to their FTTH networks in Bogota. In Colombia, the company also uses DTH to provide pay-TV services to customers located outside of its HFC and FTTH network coverage area.

Costa Rica

The company provides Cable and other fixed services in Costa Rica through Millicom Cable Costa Rica S.A. (Millicom Costa Rica), which is wholly owned by the Millicom Group. The company has operated in Costa Rica since its acquisition of Amnet in 2008.

Cable and Other Fixed Services: As of December 31, 2022, the company had 247,000 customer relationships through its HFC network and DTH services, and it isthe second largest provider of pay-TV and the fourth largest provider of broadband internet services in Costa Rica, as measured by subscribers.

El Salvador

The company provides Mobile and Cable and other fixed services in El Salvador through Telemóvil El Salvador, S.A. de C.V. (Telemóvil), which is wholly owned by the Millicom Group.

Mobile: As of December 31, 2022, the company served 3.0 million subscribers and was the largest provider of Mobile services in El Salvador as measured by subscribers.

Cable and Other Fixed Services: Telemóvil is a leading cable operator in El Salvador. As of December 31, 2022, the company was the second largest provider of pay-TV and the second largest provider of broadband internet services, as measured by subscribers, with a total of 299,000 customer relationships on its HFC network and DTH services.

Guatemala

The company provides Mobile and Cable and other fixed services in Guatemala, principally through Comunicaciones Celulares S.A. (Comcel). On November 12, 2021, the company signed and closed an agreement to acquire the remaining 45% equity interest in Comcel and the other entities that operate its Guatemala business from its local partner.

Mobile: As of December 31, 2022, the company provided Mobile services to 11.8 million customers and were the largest provider of mobile services in Guatemala, as measured by subscribers. In 2022, the company became the first mobile operator in the country to launch 5G services.

Cable and Other Fixed Services: As of December 31, 2022, the company is the largest provider of pay-TV and broadband internet services in Guatemala, and served 723,000 customer relationships with both HFC and FTTH networks, as well as DTH services.

Honduras

The company provides Mobile and Cable and other fixed services in Honduras through Telefónica Celular S.A. de C.V. (Celtel), a joint venture in which the Millicom Group holds a 66.67% equity interest. The remaining 33.33% of Celtel is owned by the company’s local partner.

Mobile: As of December 31, 2022, the company served 5.2 million Mobile subscribers.

Cable and Other Fixed Services: As of December 31, 2022, the company was the second largest provider of Pay TV and the largest provider of broadband internet services, as measured by subscribers, with 196,000 customer relationships. The company offers triple-play services (cable TV, internet and fixed telephone) using its HFC network in Honduras, and it also offers DTH, expanding the reach of its pay-TV offering to areas not covered by its HFC network. The company continues to invest to expand and upgrade the capacity of its HFC network in Honduras.

Nicaragua

In 2019, the company purchased Telefonía Celular de Nicaragua, S.A., the leading provider of Mobile services in the country, based on the number of subscribers. As of December 31, 2022, the company served 3.9 million mobile subscribers.

Panama

The company provides Mobile and Cable and other fixed services in Panama through Telecomunicaciones Digitales, S.A. (Tigo Panama). In June 2022, the company acquired the remaining 20% stake and owns 100% of Tigo Panama. In 2019, Tigo Panama acquired Grupo de Comunicaciones Digitales S.A. and started to provide Mobile services.

Mobile: As of December 31, 2022, the company had 2.4 million Mobile subscribers.

Cable and Other Fixed Services: As of December 31, 2022, the company had 467,000 customer relationships on its HFC and FTTH network, as well as through DTH services.

Paraguay

The company provides Mobile and Cable and other fixed services in Paraguay through various subsidiaries which are all wholly owned by the Millicom Group. The company’s largest subsidiary in Paraguay is Telefónica Celular del Paraguay S.A. (Telecel).

Mobile: As of December 31, 2022, the company had 4.3 million Mobile subscribers.

Cable and Other Fixed Services: The company is the largest provider of pay-TV and broadband internet services in Paraguay. As of December 31, 2022, the company had 497,000 customer relationships with its HFC and FTTH networks, DTH, and, to a much lesser extent, other technologies. The company offers pay-TV services primarily using its HFC network, and it uses DTH license to offer pay-TV in areas not reached by its HFC and FTTH networks. The company offers residential broadband internet services mostly using its HFC and FTTH networks, but it also employs fixed wireless technology to provide service beyond the reach of its HFC and FTTH networks. The company has exclusive rights to broadcast Paraguay’s national league championship games through 2023, and it has exclusive sponsorship rights in telecommunications for the Paraguayan National Soccer Team through 2023.

Bolivia: The company holds a license to provide telecommunication services in Bolivia until 2051, mobile service authorization and spectrum licenses until 2030, and cable, VOIP and internet authorizations until 2028.

Colombia: Colombia Móvil has two separate nationwide spectrum licenses in the 1900 MHz band. In June 2013, Colombia Móvil, acquired spectrum in the AWS (1700/2100 MHz) band, which the company uses to offer 4G services. The company has a network sharing agreement with its competitor, Telefónica Colombia. Colombia Móvil also has an indefinite license (Habilitación General) that allows the company to offer several nationwide telecommunication services. The Colombian government auctioned 700 MHz spectrum in 2019, and the company obtained 2x20 MHz in this band, which was key for its business to compete effectively in the market. In 2023, the company’s AWS and 1900 MHz spectrum licenses expire, and the company and the broader industry are jointly discussing renewal terms with the government. In 2019, the company’s cable TV license was successfully migrated to the indefinite license (Habilitación General) to provide telecommunication services in Colombia, in accordance with the new law.

Costa Rica: The company holds a general license to provide telecommunication services, which expires in 2024, and a spectrum permit to download content for cable TV services which expires in 2029.

El Salvador: In 2017 and 2018, Telemóvil successfully renewed all of its spectrum licenses. In December 2019, the regulator completed an auction for AWS spectrum in which the company acquired 5 blocks totaling 2x25MHz of bandwidth.

Guatemala: Comcel operates a nationwide mobile network, and it holds spectrum licenses that begin to expire in 2032. In recent years, the regulator has discussed the possibility of auctioning additional spectrum and the government announced its intent to move forward with an auction in the 700MHz band during 2021, but the process has been delayed due to legal challenges.

Honduras: Celtel has spectrum licenses in the 850 MHz and AWS bands, which expire in 2028. The Honduran government has been planning an auction of multiband frequency spectrum in the 700 MHz and 3,500 MHz bands. The auction has been delayed several times since its approval in 2016, most recently due to the coronavirus (COVID-19) pandemic and now as result of the change of authorities given the introduction of a new government.

Panama: The company holds two cable TV licenses that expire in 2024, a radio license that expires in 2025 and two commercial data transmission licenses and an Internet for public access license that expire in 2038. The company owns 2x32.5 MHz in line with the rest of market competitors in 700MHz, 850MHz and 1900MHz bands. The company acquired this spectrum permanently in the AWS band in 2022.

Paraguay: The company owns licenses in four bands of spectrum in Paraguay to provide mobile services, and these give it access to low, mid, and high frequencies, which provide an optimal mix to allow it to offer high-quality network coverage and give it the ability to increase network capacity to meet growing traffic demand needs. We also own spectrum in the 3.5GHz band to provide FWA services.

Trademarks and Licenses

The company owns or has rights to some registered trademarks in its business, including Tigo, Tigo Business, Tigo Sports, Mi Tigo, Tigo Shop, Tigo Money, Tigo OneTv, Millicom and The Digital Lifestyle, among others.

History

Millicom International Cellular S.A. was founded in 1990.