Fixed broadband revenue in Brazil is expected to reach $288 million by 2018 as telecoms will invest in Capex (capital spending) towards G.Fast and GPON upgrades and cable operators will roll out DOCSIS 3.1, said Infonetics.
“Spending on fixed broadband equipment in Brazil stalled in 2013 as telecom operators slowed their purchases of new equipment after higher spending the prior two years. Lifting of regulatory restrictions will drive new investments this year and beyond,” said Jeff Heynen, principal analyst for broadband access and pay TV at Infonetics Research.
Reuters today reported that Spain’s Telefonica has made an $8.99 billion bid to France’s Vivendi for its Brazilian broadband unit GVT, seeking to strengthen its position in a market that accounts for one-fifth of revenue.
Telefonica, which owns Brazil’s leading mobile operator Vivo, also offered Vivendi the chance to acquire its 8.3 percent stake in Telecom Italia.
Infonetics Research said Brazil ranks in the top 10 broadband countries worldwide, with 22 million broadband users out of a population of around 200 million.
Fixed broadband equipment revenue in Brazil slipped 11 percent year-over-year in 2013 to $175 million as telecom and cable operators slowed purchases.
Broadband users are primarily located in the urban areas of Rio and São Paulo, Brazil’s 2 largest cities, where penetration rates are near 35 percent.
Penetration rates in rural areas are low due to a history of underinvestment by the major private operators in the fixed access, backbone, and middle mile networks required to connect rural municipalities.
Significant consolidation has taken place among Brazil’s largest operators, with America Movil combining Claro, Embratel, and NET Servicos, the country’s largest cable operator.
Reuters report says Brazil is a crucial market for the Spanish telecoms giant since it is its second largest cash generator and has growth potential unlike relatively saturated markets such as Germany and Britain.
Arris is the overall broadband revenue share leader in Brazil in 2013, while Alcatel-Lucent led in DSL equipment revenue and Huawei headed PON equipment revenue.
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