Telebrasil: Investment Dropped to US$6.2bn in 2006

Investment in Brazil's telecoms sector slumped to 12.6bn reais (US$6.2bn) in 2006 from 14.7bn reais in 2005, according to data from Brazilian telecommunications association Telebrasil.

Since the end of privatization around the close of the 1990s, telcos invested heavily to meet the requirements of the country's telecoms watchdog Anatel and meet pent up demand, especially in 2001 when investment reached 24.2bn reais, according to Telebrasil president Ronaldo Iabrud.

This was a unique period, Brazilian newspaper Valor Econômico reported Iabrudi as saying.

Investment levels are only expected to grow this year if the auctions for 3G and WiMax go ahead, the newspaper reported telecoms equipment suppliers as saying.

Overall, gross revenues for Brazil's fixed line operators remained relatively flat in 2006, with 1.2% growth compared to 2005, according to Telebrasil, which compiled data from fixed and mobile phone operators, equipment manufacturers and pay TV companies.

Combined revenues for traditional telephone service for Brazil's major fixed line operators Telefónica, Brasil Telecom, Telemar and Embratel Participações increased to 70.5bn reais in 2006 from 69.2bn reais in 2005, Telebrasil's data said.

Revenues from long distance calls dropped to 13.1bn reais from 13.6bn reais in 2005, while revenues from international calls fell to 1.0bn reais from 1.2bn reais.

To help compensate, revenues from broadband surged to 9.9bn reais in 2006 from 7.1bn reais in 2005, while pay TV accounted for 5.5bn reais, up 17%.

Revenues for mobile phone companies grew 17% to 49.3bn reais last year, with an average ARPU of 30.6 reais, up from 29 reais a year earlier."

Posted to the site on 10th April 2007