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Mobile Data & Broadband Access Fuel Growth for Brazilian Telecom Market

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Despite challenging economic conditions in 2009, expansion in mobile data services and broadband Internet access will fuel the growth of the Brazilian telecom market, helping it retain the position of the largest telecom market in Latin America, according to the latest report from Pyramid Research.

"We estimate that total telecom revenue in Brazil in 2008 reached $55.8 billion, up $7.4 billion from 2007," comments Fernando Faria, senior analyst at Pyramid Research and author of the report. "This growth has been fueled due to a jump in mobile penetration and data services per subscriber," he continues, adding that mobile subscriptions as a proportion of population jumped from 65 percent in 2007 to 79 percent in 2008. Pyramid expects the subscription base to grow at a 7.9 percent CAGR between 2008 and 2013, reaching 222 million mobile phone lines and 109 percent penetration by year-end 2013.

"This would place Brazil's penetration rate above markets such as Mexico and Colombia," adds Faria. Following the 50 percent growth in mobile data average revenue per subscriber from 2007 to 2008, Pyramid expects data to continue increasing its relevance in the Brazilian mobile market, where ample room for growth is anticipated. Due to these increases, Pyramid revised its market size estimates going forward and anticipates data services, fixed and mobile, will boost the total market size despite the decrease in fixed and mobile voice revenue to reach nearly $64 billion in 2013, equating to CAGR of 2.9 percent in the next five years.

Government involvement in the sector is promoted by Brazil's telecom regulator, Agencia Nacional de Telecomunicacoes (Anatel), whose 2009-2010 agenda will focus on a thorough revision of the basic telecommunications law (Lei Geral das Telecomunicacoes, LGT), triggered by Oi's acquisition of Brasil Telecom. Anatel's agenda also includes overseeing M&A activity, number portability, and WiMax spectrum licensing.

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Tags: mobile data  wimax  pyramid research  cagr  Brazil