What changes in the Brazilian competitive scenario with Vivendi purchasing GVT
Vivendi announced on 11/13/2009 the acquisition of 57.5% of GVT's stocks, beating Telefonica in the competition for the operators' control (more details).
By this acquisition, Vivendi became the 5th big group to operate in the Brazilian market. Vivendi's as big as other international groups operating in Brazil, with revenue and net debt similar to Slim Group's (more details).
GVT still has a small participation in the Brazilian telecommunication market, with 1.8% of the gross revenue, 3.5% of the fixed telephones and 5.4% of the broadband accesses. The expectation, however, is that this participation will increase in a more accelerated pace due to Vivendi's highest capacity to invest.
Gross Revenue R$ Millions |
Accesses (Thousands) 3Q09 |
||||||
Jan-Sep/09 |
3Q09 |
Fixed |
Mobile |
Broadband |
Pay TV |
||
| 1 | Telefonica/Vivo | 34,197
|
11,411 |
11,333 |
48,847 |
2,578 |
508 |
| 2 | Oi | 34,023 |
11,597
|
21,479 |
34,818 |
4,142 |
62 |
| 3 | Claro/Embratel/Net | 27,160 |
9,461 |
6,338 |
42,278 |
2,790 |
3,645 |
| 4 | Tim | 13,369 |
4,651 |
- |
39,600 |
- |
- |
| 5 | GVT | 1,994 |
724 |
1,477 |
- |
604 |
- |
| - | Others | 7,132 |
2,484 |
973 |
578 |
994 |
2,883 |
| Total Brazil | 117,874 |
40,328 |
41,630 |
166,121 |
11,108 |
7,098 |
|
Vivendi may amplify GVT's operations for mobile telephony and Pay TV areas. The company controls Canal+, which is the Pay TV leader in France and, having Vodafone as partner, controls SFR (2nd French mobile and fixed operator). Vivendi, with Nextel, turns out to be a strong candidate to acquire national license for 3G, to which Anatel will hold an auction in the next year.
In this new scenario, the bigger groups that operate in the Brazilian market are losing because the competition increases with the entrance of a new player of international size, strong in mobile telephony, broadband, Pay TV and content, on the other hand the customer wins.
Among those big groups, Telefonica is the biggest loser, since the company will have more difficulties to expand its operations out of the state of São Paulo. Telefonica had a difficult 3rd quarter with the cessation of Speedy sales determined by Anatel. Telefonica lost the 2nd position in broadband accesses for Net and was surpassed by Oi in gross revenue in the quarter.
In this new scenario the groups will have to accelerate their strategies of integrating fixed with mobile in order to make easier to offer convergent services. Oi had already done this integration and Telefonica will have to overcome Vivo's shareholder division with Portugal Telecom if it wants to follow the integration pace. The situation is harder for Carlos Slim's group which still keeps this division with América Movil and Telmex, acting in an independent way.
Another variable in this scenario is Tim's future. Although Telecom Italia has dropped selling the operator in Brazil, this option may be considered again, in face of the competitive scenario in Brazil.
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