Oi is the leader in fixed broadband in Brazil holding 5.3 million accesses in the 1st Semester of 2012 (1S12), followed by Net (4.9 million), Telefônica/Vivo (3.7 million) and GVT (1.8 million).
GVT is the leader in fixed broadband accesses with speeds faster than 12 Mbps. Net lead accesses with speeds between 2 and 12 Mbps.
Most of the fixed broadband accesses with speeds slower than 2 Mbps are operated bt Oi and Telefônica/Vivo.
Source: Anatel and Teleco.
GVT is the operator in which fixed broadband accesses have the fastest speed. 98% of GVT's accesses have speed faster than 2 Mbps, at Net it reaches 53.5%, 30.2% at Oi and 15.1% at Telefônica/Vivo.
This is one of the reasons why Net and GVT are gaining market share, while Oi and Telefônica/Vivo are losing it.
The predominance of accesses with speeds slower than 2 Mbps at Telefônica/Vivo and Oi happens due to the technology limitation (xDSL) used by these operators. xDSL shows speed limitations when the distance between the central and the subscriber is increased.
In order to get over this problem, GVT adopted a network architecture in which fiber gets to a distribution cabinet in the neighborhood and the "copper pair" is used only in the last 500 meters. Similar solution is being adopted by TIM Fiber.
Net adopts HFC architecture in which fiber also gets close to the subscriber and the coaxial cable is used in the last meters.
Telefônica and Oi announced the adoption of a network architecture to high speed access in which fiber goes until the residence (FTTH). This is the best solution because makes easier the upgrade for higher speeds, that will be necessary in the future. The problem is: the cost is higher than the cost of the solution adopted by GVT and Net, and for this reason FTTH is available for a small part of the clients. Telefônica/Vivo's FFTH network, for instance, had only 89 mil subscribers in 2Q12.
As long as this difference of speed exists, it will be difficult for Oi and Telefônica/Vivo compete with GVT and Net in areas where these companies are present. GVT offers fixed broadband in 135 cities and NET in 122.
The loss is even bigger for Oi and Telefônica/Vivo because, besides the fixed broadband, they also lose the fixed telephony revenue of this client that migrates to Net's or GVT's services packages.
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