The competition between Vivo and TIM
Vivo and TIM got into fierce competition for the leadership of the prepaid market share in Brazil.
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In 2011, TIM led prepaid net adds and reduced the difference to Vivo from 4.1 million in 2010 to 660 thousand in 2011. In January, Vivo led cellular growth and increased its advantage over TIM to 895 thousand prepaid accesses.
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Kept the current trends, TIM can overtake Vivo and become leader in prepaid market share in the next months.
Vivo's leadership in cellular market share isn't threatened yet, due to the performance gotten by the company inside de postpaid segment. The difference between Vivo and TIM in postpaid hit 6,864 thousand cellulars in Jan/11.
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The investment in 3G is one of Vivo's triumphs to keep its leadership in postpaid segment. In 4Q11, Vivo overtook TIM in ARPU and in data revenue. TIM surpassed Vivo in minutes of use (MOU).
| 4Q11 | Vivo | TIM |
| ARPU | 24.6 | 21.9 |
| MOU | 119 | 131 |
| Month Churn | 3.0% | 3.9% |
| Data/Mobile services revenue | 26.0% | 16.7% |
| Cities covered by 3G | 2,516 | 488 |
Vivo's month churn (3.0%), still inferior to TIM's (3.9%), is the result of bigger participation of postpaid in its clients base.
Comparing financial economic indicators, Vivo/Telefônica showed the best profitability with Ebitda margin of 38.5% in 4Q11 and net profit of R$ 1,462 million.
| R$ million - 4Q11 | Vivo |
TIM |
| Net Revenue | 8,600 |
4,688 |
| Mobile Revenue | 5,271 |
4431 |
| Fixed Revenue | 3,329 |
257 |
| EBITDA | 3,308 |
1,305 |
| Ebitda Margin | 38.5% |
27.8% |
| Profit | 1,462 |
405 |
Investments |
1,953 |
1,150 |
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