Brazil

The Brazilian mobile market is worth around R$55 billion, and ended the first half of 2011 with 217.3 million costumers, which represents a penetration of 111.6%. The market is divided between four major players with relevant shares (form 19% to 29,5%).

The four companies disputing the market nowadays are: TIM Brasil, Vivo that now is merged with Telesp and fully controlled by Telefónica, Claro that is merged with Embratel and controlled by the Mexican group America Movil and Oi that is integrated with Telemar and is controlled by a Brazilian group, but with a significant participation of Portugal Telecom in its corporate structure. There is a fifth player (Nextel) in the market, although the company have already bought 3G licenses to operate under SMP rules (Personal Mobile Services). They didn’t develop their network yet, so they still operates under a different set of rules called SME (Special Mobile Services or Trunking).  In the first half of 2011 the net additions totaled 14.4 million accesses, which represent a 17% growth YoY. TIM Brasil was the company that most expanded its base in the 1H11, followed by Claro, Vivo and Oi.

On the fixed segment, the market is almost fully controlled by Telemar (Oi), Brasil Telecom (Oi), Embratel (Claro), Telesp (Vivo) and a small participation of Intelig and GVT, both challenging the incumbents in different forms (Intelig is more focused on the corporate segment and GVT is mainly focused in residential broadband). In regions I and II, Telemar/Brasil Telecom controls around 75% of the market, with Embratel with the second largest market share. On the Region III (with the higher GDP per capita of the country), Telesp controls more 70% of the market share. GVT is the challenger company in the fixed segment and is expanding its share mainly in the region III. Along with GVT, Net Serviços, which is a cable TV company controlled by America Movil, is gaining market through its broadband offer. In 2010, the fixed voice segment posted a slightly growth of 1.2% YoY ending the period with 42 million accesses, which represents a penetration rate of 21.7% and the broadband market ended 1Q11 with 14.5 million costumers, a 22.1% growth YoY. The Brazilian fixed voice business worth approximately R$48 billion and the broadband worth around R$11 billion. The conventional fixed business is receiving pressure from fixed-to-mobile substitution process and due to the increase of competition in the broadband services.