TIM x Claro, which company is winning this competition?
TIM is the second operator in cellular market share in Brazil after overtaking Claro in 2011. Both carriers have competed fiercely for the market alternating themselves in the first and second position over the last 10 years (more details).
TIM ended the first quarter of 2012 (1Q12) counting 67.2 million mobile accesses, 5.6 million subscribers more than Claro. However, Claro continues to overtake TIM inside postpaid segment by holding 3.2 million accesses in advantage.
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In 1Q12, TIM surpassed Claro in gross and net adds in prepaid and in postpaid.
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Both companies presented monthly churn of 3.7% in the quarter, resulting from the cancellation of 7.1 million TIM's cellulars and of 6.7 million Claro's. Despite of being high, those monthly churn showed reduction in 1Q12.
| - | TIM |
Claro |
| ARPU (R$) | 19.1 |
17 |
| MOU (minutes) | 126 |
105 |
| Monthly Churn | 3.7% |
3.7% |
TIM overtook Claro in ARPU and MOU.
Claro's smallest ARPU can be part explained because it doesn't include the revenue gotten from long distance calls which is counted by Embratel, that's the opposite of what happens with TIM, Vivo and Oi. Teleco estimates TIM's long distance revenue in R$ 540 million.
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TIM's policy to increase handsets sales with promotional price, but without subsidies, made the company to have more than the double of Claro's handset revenue.
TIM presents today advantage over Claro in cellular market, especially in prepaid and in revenue.
Claro overtakes TIM in prepaid and in 3G coverage, covering 866 cities against 512 covered by TIM. Claro wants to turn the table by getting started in 4G. So it activated HSPA+ and was the operator that defended in a stronger way the auction of frequencies 2.5 GHz in 2012.
América Móvil is likely to conclude in 2012 the merger of its fixed and mobile operations in Brazil, adopting the brand "Claro" for services to final consumer (retail), like what Oi and Vivo are doing. TIM wants to offer fixed broadband inside metropolitan region of Rio de Janeiro and São Paulo through TIM Fiber.
You could ask:
What about ARPU? Will it increase in 2012?
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