Oi
- The market cap of Telefônica Brasil and TIM Participações grew in 2019, while Oi's decreased.
- This week, however, Oi's ON shares appreciated with the disclosure of Banco BTG Pactual's Report, which maintained the recommendation to buy these shares. BTG's optimism is linked to the possibility of selling Oi Móvel in the future, for up to R$ 18 billion.
- ON shares appreciated by + 2.2% in the week and PN shares fell by -0.8%.
5G
Subtel (Chile) opened public consultation about the frequencies that will be part of the auction for 5G (TDD):
- 3.5 GHz, 150 MHz in 15 blocks in minimum of 10 MHz
- 28 GHz, 800 MHz in two blocks of 400 MHz.
Frequencies in 700, 1,700 and 2,100 MHz will also be auctioned.
A group of U.S. senators introduced a new bill proposing the government to inject more than US$ 1 billion into the development of Western 5G equipment in an attempt to challenge Huawei.
UK Prime Minister Boris Johnson commented about Huawei's critics: “We want to put Gigabit broadband for everyone. Now, if people are opposed to one brand or another, then they have to tell us what the alternative is."
Smartphones and cell phone use
OpenSignal's report on the user experience when using cell phones in Brazil pointed out as best to:
- Claro in download and upload speed, video and voice use in App;
- TIM in Latency, Availability and 4G coverage.
Samsung will start selling its smartphone with foldable screen (Galaxy Fold) in Brazil for R$ 13 thousand.
Vivo's corporate cell phone users will be able to purchase data/voice franchises for personal use, without having to have another line/device for personal use.
11.3% of cell phones sold in Brazil in 3Q19 (1.28 million) were illegal (gray market). (IDC)
The “State of Mobile in 2020” report by App Annie presented the main applications in Brazil for:
- Finance: Nubank, FGTS, PicPay, Caixa and Mercado Pago;
- Retail: Mercado Livre, Americanas, Magazine Luiza, AliExpress, Wish
- Video Streaming: Netflix, YouTube Go, Amazon Prime Video, Globo Play and Viki
The Disney + video streaming app was downloaded 31 million times during 4Q19. Disney + was by far the most downloaded application in the USA and the ninth most downloaded in the world.
IDC estimates that global of used smartphones in 2019 would total 206.7 million units, up from 175.8 million in 2018 - 17.6% more in the period - while sales of new devices showed low growth.
Other highlights
- 8.9 million telephone numbers were ported in Brazil in 2019, 33.1% more than the previous year. The growth occurred mainly among cell phones (40.7%), which represented 83% of ported numbers. The growth of postpaid has served as a stimulus for the use of portability.
- Anatel will hold an extraordinary board meeting this week (01/22) to deal with the migration process of STFC concessionaires to the authorized regime. The 5G notice and AT&T's acquisition of Time Warner are due to be discussed at the February 6th meeting.
- MCTIC will reevaluate the 4G targets in PGMU IV, fulfilling the request made by Anatel.
- American Tower ended 2019 with its IoT/LoRaWAN network serving 220 municipalities.
- Copel Telecom's sale process was halted, with the court's decision to suspend the advisory contract with Banco Rothschild, due to the fact that the contract was made without bidding.
- CI&T/Opinion Box survey conducted in Dec/19 with over 500 executives of large companies indicated that the technologies that will leverage business growth in Brazil in 2020 are Cloud Computing (57%), IoT (49%), Artificial Intelligence ( 48%), virtual assistants (41%), immersive experiences (37%), big data (30%) and chatbots (23%).
- PC sales worldwide increased 2.7% in 2019 and Lenovo (64.8 million), HP (63.0 million) and Dell (46.5 million) accounted for 65% of sales. (Canalys)
5G
- The Chinese are more eager for 5G than other countries. GSMA research indicates that 46% intend to buy a 5G smartphone as soon as it is operating, more than in the US (28%), Europe and Korea;
- The China Broadcasting Network (CBN) has received government approval to deploy its 4.9GHz 5G network in 16 Chinese cities, along with the country's three major mobile operators. China Telecom and China Unicom received 100MHz in the 3.5MHz band, while market leader China Mobile received 260 MHz of spectrum at 2.6 GHz and 4.8 GHz;
- The amount collected in the last 5G frequency auction in Band C ranged from US$ 0.4/MHz/POP in Italy to 0.05/MHz/POP in Spain. This would imply that Band C revenue in Brazil (300 MHz at 3.5 GHz) would range from US$ 25 billion to US$ 3 billion;
- Nokia has announced it has reached 63 5G contracts, of which 18 involve network deployments in operation.
IoT
There were 9.5 billion IoT devices connected at the end of 2019, according to IoT Analytics estimates. The 3 main drivers are:
- A burst of consumer devices (particularly Smart Home)
- IoT mobile connections / M2M is growing strongly
- Growth of devices connectivity in China
Implementations are happening on the scale of hundreds of thousands or even millions of devices. Recent examples are (IoT Analytics):
- 1 million NB-IoT meters in Sweden
- over 100 thousand ThyssenKrupp connected elevators
- over 0.5 million Tesla cars
- 380,000 Maersk connected refrigerated containers deployed on ships worldwide
- 8.5 million devices connected to the Bosch IoT platform. (There are 620 IoT platforms in the market)
At a panel of US carriers at CES 2020, executives admitted that they are still looking for the best way to approach the IoT consumer after focusing on early growth efforts in the business sector.
Oi
- Oi will receive R$ 669 million from Sistel, in which it participates as a sponsor, related to the private pension fund surplus;
- ON shares appreciated 3.5% in the week and PN 2.4%.
Submarine cables
- Seaborn Networks and Seabras-1 Brasil Ltda aren't part of the US Lawsuit (Chapter 11) for bankruptcy filled by Seabras 1 Bermuda Ltd and Seabras 1 USA LLC in the United States;
- Telebrás will no longer participate in cable Ella Link, which connects Brazil with Spain. The company had no money to meet its 2019 commitments, and it will not have by 2020.
Other Highlights
- Carlos Baigorri is the first on Anatel's triple list to temporarily take a seat on the board. The appointment may be made by the Presidency of the Republic from January 31, as established by the new Agency Law. The interim term is up to 180 days;
- Anatel has decided to request more information from MCTIC to implement the 4G coverage targets set in the General Plan for Universalization Goals (PGMU IV), as it has encountered economic, legal and regulatory obstacles to implement the planned obligations;
- The presidential decree that will regulate Law 13.879-19 will establish that the renewal of spectrum licenses that have already been sold must also be made in accordance with the new rules established in the Law;
- Vivo's artificial intelligence (Aura) is already being used in more than 20 service channels making more than 20 million customer service calls by month;
- 240 million web application attacks were launched in Brazil between Nov/17 and Sep/19. The country is in 7th place and the US is 1st with 1.4 billion attacks originated (Akamai);
- Preliminary data indicate that Samsung's profit fell 53% in 2019 and LG's 10%;
- Ascenty has announced the construction of another data center in Vineyard. The unit will have 24,000 m² and will go into operation in the second half of 2020. The construction will cost R$ 200 million;
- CES 2020, the annual event of the Consumer Technology Association, brought nothing new to 5G smartphones, but had as one of the main highlights the presentation of Quibi's streaming service. This is a smartphone service with videos up to 10 minutes long;
- AT&T plans to control with software 75% of its core network functions by the end of 2020. The operator achieved 65% virtualization in 2019 and 55% in 2018. Currently SDN controls 100% of data traffic between elements of its main network.
Growth in the year until November
- Net additions accumulated up to November 2019 confirm the growth trend for fixed broadband and a decline in prepaid, fixed telephony and pay TV subscribers.
- The growth in postpaid, driven by M2M and the migration from prepaid to control plans has not yet been enough to overcome losses in prepaid and stabilize the mobile base in Brazil. This is expected to happen in 2020.
- Fiber accesses were responsible for the growth of fixed broadband, overcoming losses with accesses of metallic pairs (xDSL).
5G
- MCTIC may publish an ordinance opting for the coexistence of 5G in the 3.5 GHz band with the satellite reception satellite dishes of open TV in the C band. (Value)
- France has started the auction process for 5G frequencies in the 3.4GHz to 3.8GHz range. France's four existing operators will be able to purchase 50MHz each at a fixed price of € 350 million. Other 10MHz blocks will be sold at auction with an initial price for each lot of € 70 million. The authorities hope to raise at least € 2.2 billion. All lots are associated with coverage commitments, with licenses lasting an initial period of 15 years.
- Samsung announced that it sold about 6.7 million Galaxy 5G smartphones in 2019, which would represent more than half of the global 5G smartphone base.
Other highlights
- Liq (former Contax), a call center company which has Oi as its main customer, filed for bankruptcy in the São Paulo court.
- Oi's ON and PN shares did not change during the week.
- Huawei's revenue grew 18% in 2019 reaching about US$ 122 billion. In 2018, growth had been 19.5%. Smartphone sales grew 16.5%, reaching 240 million units, more than the 206 million registered in the previous year.
Coming weeks
- CES 2020, the annual event of the Consumer Technology Association, will take place between January 7-10 in Las Vegas, which will present the latest news on mobile devices.
