4. Mexico Has Hosted A Successful Console Launch

In 2004, Sony brought the PlayStation 2 to Mexico, officially. According to Jeffrey Wright at America's News Intelligence (http://www.latinintel.com/), they opened a distribution facility to put the console in retail stores at an affordable price and Sony has sold over 860,000 units in Mexico as of Q4 2007. The piracy rate of PS2 games dropped very quickly after the official launch. While not technically a part of South America, Mexico's example shows that with the right support, Latin America can be developed into a viable market.

5. High Broadband Penetration

Broadband penetration in South America is significant, 22.7%, and on the rise. In the more developed countries, such as Chile, Argentina, Uruguay and Brazil, high-speed Internet access exists on the private level and in public Locutorios, the Latin-equivalent of an Internet cafe. A little fewer than 83 million people access the Internet in South America.

6. Low Conversion Rates

People play games over the Internet in South America, in their homes or at Locutorios, in the same widening fan of casual acceptance that has been seen in the Northern Hemisphere. However, sales of casual download-able games are practically nil, for two reasons: over half of that audience only use Locutorios and the inconveniences of a download are exacerbated by a ticking clock that will shut-down the computer when expired; and the other reason is that nobody wants to pay $20 to unlock a game when that cost in their home currency is closer to what Northerners pay for a retail, console game. The same goes for subscription based games. As a result, free games operating on some kind of micro-transaction, virtual currency-oriented business model are the only viable model, other than traditional advertising for Flash games. For instance, Regnum online is a 3D MMORPG developed and operated by NGD Studios in Buenos Aires, most of its player base is in Argentina, Brazil, Spain and Germany. Less than 40% of its population is in the Eurozone, yet these players account for more than 80% of revenue. While the European players purchase premium content a lot more frequently, the South American audience does pay a bit, every once in a while, and this can be made-up for in volume.

7. There Is A Game Industry In South America

Wanako Games, now a subsidiary of Sierra, is based in Santiago, Chile. In Uruguay, there is Gonzalo Frasca's Powerful Robot Games and Mystery Games. In Argentina, there is Sabarasa, developer of Wii, DS and PSP games; QB9, developer of premium casual games published by Mumbo Jumbo; Regnum developer NGD Studios; Three Melons, an advergame developer; and one of the top three worldwide studios for GameLoft. Lima, Peru hosts a few web-game developers, including Bamtang Studios. Brazil is home to over 40 game companies, including PC developer's Jynx Playware and Interama.

This is only a partial listing of already consolidated companies; start-ups and/or contracting companies number in the dozens, and most of these have come into being within the last year. In Buenos Aires in particular there is a lure of lowered costs and cultural/time-zone compatibility that makes the site attractive for 3rd party publishers looking to open up a branch studio. For instance, Google opened up a headquarters in Puerto Madero with over 1,000 employees dedicated to servicing the entire Spanish-speaking world, and GameLoft has come to rely on BsAs as one of its pillars of operation. With the massive base of students and veterans being produced, it's not out of the question that the city could become the next Montreal. Similar growth patterns can be seen among major cities in Brazil, particularly Recife and Sao Paolo.