8 things we learned at Capacity Latam 2025

The theme of inter-metro connectivity stitched together quite a few presentations and panels at Capacity Latam this year. Speakers on the keynote panel discussion spent quite some time discussing the lack of varied and affordable long-distance connectivity, particularly in Brazil, where many operators are hamstrung by the lack of new connections between the regions they want to operate in.

The issue came up separately in an Argentina-focused panel (see below for more ) – showing long-distance links are a nut that needs to be cracked to unleash Latam connectivity potential.

One thing came across loud and clear was that Argentina lags other countries in the region by enormous multiples.

Santiago currently has 10 times the data capacity of Buenos Aires - while São Paulo is eight times bigger than Santiago.

But there is huge potential in Argentina’s digital infrastructure sector. The economic situation in on the road to recovery, there is lots of renewable energy (and natural gas if necessary), and the country has some of the cheapest land in South America for putting up facilities.

There are challenges to overcome – facilities are concentrated in the capital and intercity links are not where they need to be, for example – but the room for growth in the Argentinian market is arguably the most promising in Latin America.

Chile, on the other hand, has spent the last decade fully capitalising on its digital hub potential.

The highest profile driver for Chilean connectivity recently has been subsea activity. The Humboldt cable, the first trans-Pacific link to South America, is currently under development, coming in the wake of the Los Angeles-Chile Curie cable, the first subsea cable to land in Chile in two decades.

But aside from this, speakers on a Chile-focused panel homed in on another aspect driving Chilean connectivity – regulatory innovation and ease of doing business.

There is a strong focus on improving data and physical security to meet international standards, with the aim of bringing more investment. Permitting has also been an area in focus – one innovation highlighted in the session was that any company with a telecoms licence in Chile has the automatic right to land a subsea cable.

One year ago, the conclusion was that Fortaleza in northeastern Brazil was growing as a digital hub – that’s even more the case this year. The subsea connections are either in place or being built, and this year’s discussion focused more on the data centre side.

Tecto’s third Fortaleza data centre – or ‘Mega Lobster,’ adding to the opening of the existing V.Tal’s Big Lobster in 2023, is under construction, adding to the wide range of digital infrastructure present in the city. But several panellists are worried about over-concentration in Fortaleza and the security risks it could bring. This led to calls for expansion to other regions in the northeast of the country, which is particularly attractive for Brazilian connectivity as it is the closest region to Europe.

At the Capacity CALA event in Miami in December, Brazil’s huge quantity of green power was highlighted as a key selling point – as well as its fully integrated grid that can move this power to where it is needed.

Three months on, this was echoed in São Paulo – Ciena’s Ricardo Franco told the audience that Brazil is gaining a reputation as a power leader for data centre buildout: “We have a fantastic opportunity with energy in Brazil. I have learned from a ton of customers out of Brazil that are trying to get to Brazil because they’ve heard of a fantastic electric system.”

While the cost of infrastructure often spoils the party somewhat, we are seeing clear signs of companies fulfilling predictions of ‘power-chasing.’

Brazil is a massive and varied country, both economically and geographically. So it follows the internet market will be multifaceted to cater for this diversity. That being said, Brazil has around 20,000 ISPs – that is a lot.

According to Capacity Latam’s speakers, this might mean consolidation. Competition in the market is increasing, with the 2023 Vero Internet-AmericaNet merger a sign of things to come, and the sheer scale of the country’s internet provision landscape means that 20,000 number may well be smaller by the time Capacity Latam 2026 comes around.

The tone of the session dedicated to investment in the Latam market was generally positive – with praise for the stability of Brazil, Chile, and Colombia in particular.

However, this session came with a warning – Latam is competing globally. As Jeff Ferry from ELEA Data Centers put it: “Brazil is not only competing against Uruguay, Colombia and Chile –it is competing against Norway, Malaysia and India, and many other countries in the world where AI capacity is key.”

The way forward for Brazil in particular, according to the speakers, is the need for a joined-up strategy between the various bodies involved in connectivity.

Finally, this quite from Nokia’s Andres Madero is as clear a summary as you can get about market optimism in Latam subsea right now:

“Please continue to put as much fibre as you can in the ocean – we’re more than happy to light it up.”