Was crisis responsible for cellular net adds fall in 1Q09?


March 2009 showed, for the first time, a clear trend for reduction in the cellular growth pace in Brazil, with net adds of 1.3 million, 22.5% less than the ones gotten in March/08. All operators present smaller net adds if compared to Mar/08, except for Tim which had had the smallest growth in Mar/08, Jan/09 and Feb/09.





Tim presented unusual behavior in the quarter, promoting a cleaning in its base in Feb/09 when presented negative net adds of 823 thousand cellulars.


March results consolidated the first quarter of 2009 (1Q09) with Vivo, Claro and Tim presenting net adds smaller than the ones registered in 1Q08.




Oi/BrT was the only operator to increase net adds in the quarter, due to the entrance in São Paulo's market, in which the company didn't operate in 1Q08. Without São Paulo, Oi/BrT's net adds would have been 1.3 million in 1Q09.


The crisis might be pointed as the reason for this reduction in cellular net adds, impacting also the price of cellphone devices with the dollar rising. It will be possible to have a better evaluation of the impact on services consumption after operators release the financial economic results for 1Q09.


Another factor that explains the reduction in the growth pace is that Brazil's reaching high cellular density, finishing the first quarter with 153.7 million cellulars and density of 80.57 cell/100 inhabitants. (more details).


These two factors might have also contributed to the growth of prepaid cellular stake in the Brazilian total. This stake was from 81.09% in Sep/08 to 81.61% in Mar/09.


It's important, however, to emphasize that the trend for falls in net adds is still slight. Despite the fall of 37.2% in 1Q09 in comparison with 1Q08, net adds overcome the ones gotten in 1Q07 and the accumulated in the last 12 months count 27.8 million cellulars.





You could ask:

  • Can we attribute the fall in cellular net adds growth pace to the global financial crisis?
  • Will this trend for fall increase during the year?
  • What will be the cellular net adds in 2009 in Brazil?
  • Will prepaid increase in comparison with postpaid?

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