Teleco Blog

16
6/2024

Abrint, 5G, Oi and more

Eduardo Tude

Regional providers have until 2026 to begin serving municipalities with less than 30 thousand inhabitants in their region. The strategy of each one for its 5G network is presented below:

Brisanet is expanding its 4G/5G network in the Northeast by offering postpaid and roaming plans with TIM. The 4G offer uses the 2.5 GHz band, which has a higher deployment cost and is available on fewer smartphones than the 700 MHz band. The use of 700 MHz as a secondary use would need to be extended for a period of time to become viable. In the Midwest, it intends to use a partnership model for its 5G network in the Midwest.
Unifique officially launched its 5G network in Tijucas, Santa Catarina, in partnership with ZTE. It has developed its systems (BSS) and is using 700 MHz as a secondary use. The company doesn't intend to launch postpaid plans.
Ligga Telecom intends to develop its 5G network through partners. It proposes passing on the right to use the spectrum in exchange for compliance with regulatory coverage and revenue share obligations.
iez Telecom (Cloud2U) intends to have a pilot of its network by the end of the year. It formed partnerships with Highline (one thousand towers), Algar (Core) and CPQD (Sistemas).

(Source: Interviews at Teletime's channel on Youtube)

Small Cells and 5G

5G came with the expectation that operators would invest heavily in densifying their networks with micro cells (small cells). But this great impulse didn't materialize.
In 2018, in the early days of 5G, it was predicted that there would be 800 thousand small cells in the United States by 2026, but by 2023 there were only be 202 thousand.
In Brazil there were 445 small cells and 523 Street cells registered with Anatel in May/24.

Abrint 2024

Abrint 2024 was a success, with the presence of the Minister of Communications and the provider community.
On June 11^th, the 2^nd Abrint Teleco Award was presented for the Best Broadband Providers of the Year in 7 categories.
The results can be consulted at:
https://www.teleco.com.br/blpremio.asp

Oi submitted to the Court the draft notice for the auction of Oi Fibra (ClientCo) customers. The following lots will be offered:

North: Acre, Rondônia, Tocantins, Amapá, Amazonas, Roraima and Pará;
Northeast: Maranhão, Piauí, Ceará, Paraíba, Rio Grande do Norte, Pernambuco, Alagoas, Sergipe and Bahia;
Middle-West: Mato Grosso, Mato Grosso do Sul, Goiás, Minas Gerais and Brasília;
Southeast: Espírito Santo, Rio de Janeiro and São Paulo;
South: Paraná, Santa Catarina and Rio Grande do Sul;

A V.tal, que assumiu o compromisso de cobrir o preço de R$ 7,6 bilhões pedido pela Oi, é a principal candidata para ficar com os clientes de fibra da Oi. (Teletime)

Oi's ON shares lost 13.8% in the week and its PN lost 6.0%. Ibovespa lost 0.9%.
Oi's ON share presented a loss of 6.0% in the year and the PN of 4.3%.

More Highlights

An agreement was reached regarding the desalination plant that will be built in Praia do Futuro in Ceará. It will be moved to land 560 meters from the initially chosen location, further away from the submarine cables.
Reconstruction of communications networks in Rio Grande do Sul could cost up to R$ 1.6 billion. MCom intends to make Fust resources available to providers, preferably on a non-refundable basis.
Telebras launched an RFI to receive expressions from potential interested in partnerships to use its fiber network.
Alares intends to expand its offer for B2B and launched Alares Empresas.
MVNO Veek now has two original providers: Americanet/TIM and Vivo.
Carlos Slim (America Móvil) has acquired a 3% stake in British Telecom (BT), joining other high-profile industry shareholders including Altice UK and Deutsche Telekom.

Coming Weeks

June 28^th: Nominations for the MVNO Nation Global Awards closes

https://www.mvnonation.com/awards

9
6/2024

Growth in Broadband and Mobile Telephony

Eduardo Tude

Broadband – 1Q24

Fixed Broadband net additions in 1Q24 were 64% lower than those in 1Q23.
This drop cannot be attributed solely to underreporting (8.5 thousand providers reported in 1Q23 and 8.4 thousand did it in 1Q24).
The number of accesses in 1Q24 could still increase (+280 thousand) considering the providers that reported in Apr/24, but didn't do so in Mar/24. The number of broadband accesses in Apr/24 (49 million) should grow as 7.9 providers reported accesses, less than the 8.4 thousand in Mar/24.
This drop in net additions occurred among Competitives (80%), while additions from large providers grew 6.5%, despite Oi having presented negative net additions (-37 thousand).
Net additions from the 6 largest Competitive companies also fell (-46%).
It's still too early to say whether this situation will be repeated in the coming quarters, but this fact could be an indication that the market is becoming saturated and the organic growth of Competitive Companies will become more difficult.

Accesses in Apr/24

Vivo led mobile growth in April with net additions of 464 thousand cell phones and now it has more than 100 million cell phones.
Claro (152 thousand accesses) was second, followed by all MVNOs (109 thousand) and TIM (93 thousand).
Vivo led in postpaid without M2M (232 thousand accesses), M2M (179 thousand) and prepaid (53 thousand).
Cell phones have been showing strong growth in the first 4 months (+ 2.6 million accesses). Growth was negative in the same period of 2023 (-891 thousand).
Brazil lost 640 thousand wirelines in Apr/24 and 185 thousand pay TV subscribers.

Claro maintained its 5G leadership by holding net additions of 616 thousand 5G cell phones in Apr/24, more than Vivo (526 thousand accesses) and TIM (533 thousand).
Anatel placed a proposal for the allocation of 500 MHz for Wi-Fi 6E in the 6 GHz band (5,925 and 6,425 MHz) for public consultation.

1Q24 Results: Algar

Comparing 1Q24 with 1Q23, Algar's net revenue grew 2.3%, being +7.1% in B2C. B2B revenue didn't show growth (0.0%), but the drop in connectivity revenue (-7.5%) was offset by growth in ICT Products revenue (26.1%).
The EBITDA margin reached 41.6% in 1Q24 and the company presented a net loss of 54.7 million in the quarter.

The risk rating agency Standard & Poors (S&P) revised Oi's credit rating from "D" to "CCC-" on a global scale and from "D" to "brCCC+" on a national scale.
Oi's ON share lost 3.3% in the week and the PN lost 3.5%. Ibovespa lost 1.1%.
Oi's ON share showed a loss of 9.4% in the year and the PN gained 1.8%.

More Highlights

The ICT Health survey, published this Tuesday, 4th, by the Brazilian Internet Steering Committee (CGI.br) shows that the offer of online services to patients grew in 2023. The study data indicate that between 2022 and 2023, the scheduling appointments online rose from 13% to 34%.
Information services GDP grew 2.3% when comparing the last four quarters with the four immediately previous quarters, less than Brazilian GDP (2.5%).
The LoRa Alliance announced the installation of an Authorized Testing Laboratory in Brazil.

2
6/2024

Vivo, Desktop and more

Eduardo Tude

Vivo and Desktop

Vivo is negotiating the purchase of Desktop, according to a statement published by both companies.
If this acquisition is concluded, Vivo would take the lead in fixed broadband in the state of São Paulo, surpassing Claro (30.5%), with its market share growing from 29.6% to 36.8%.
Desktop's shares have increased by 23.3% in the last 4 weeks, probably as a result of Vivo's purchase intention.

Broadband Providers

In this scenario, larger providers are moving to keep growing:

Brasil TecPar got its company register at CVM.
Alares (R$ 120 million), Vero (R$ 150 million) e Unifique (R$ 300 million) announced the issuance of debentures.
Mega concluded the acquisition of SAMM.

The Mobile Operators completed the payment of R$ 3.2 billion for the 26 GHz band grants and requested their disconnection from EACE, the entity responsible for connecting schools with these resources.
Anatel placed a proposal for the allocation of 500 MHz for Wi-Fi 6E in the 6 GHz band (5,925 and 6,425 MHz) for public consultation.

The Court approved Oi’s judicial recovery plan.
Oi's ON shares showed a gain of 1.7% in the week and the PN lost 3.4%. Ibovespa lost 1.8%
Oi's ON shares showed a loss of 6.3% in the year and the PN gained 5.5%.

More Highlights

Globo's net revenue grew 12% in 1Q24/1Q23, totaling R$ 3.7 billion.
São Paulo Court of Justice suspended the sentence that determined the change of control of Surf to Plintron.
TIM Brasil contributed to TIM Group’s revenues 1.2% growth in 1Q24/1Q23.
T-Mobile US announced its intention to acquire the majority of US Cellular's operations, including all of the company's customers and stores, and 30% of US Cellular's spectrum in a transaction valued at US$ 4.4 billion.

Eduardo Tude

President and partner at Teleco (consultancy company), works since 2002 as analyst of Telecom market, coordinating consulting projects, publishing weekly articles, preparing sector reports and presenting workshops.

Telecom Engineer (IME 1978) and MSc. in Telecom Engineering (INPE 81), Tude is member in the Mobile World Congress’s judging commission for the Global Mobile Awards, in Barcelona, and was also a visiting specialist professor at Unicamp.

Tude had many positions in the management of Telecommunication companies in areas like Mobile Systems (Ericsson), Optical Networks (Pegasus Telecom) and Satellites (INPE).

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Abrint, 5G, Oi and more

Growth in Broadband and Mobile Telephony

Vivo, Desktop and more