América Móvil's performance in Brazil during 2012 and challenges for 2013
América Móvil Group in Brazil, formed by Claro (mobile) and Embratel/Net (fixed), showed good performance along 2012. Net revenue increased 4.6% and the total of accesses grew 10.2%.
The perfoemance inside the wireline segment (fixed telephony, broadband and pay TV) was better than in mobile.
Net revenue of fixed tel. increased 8.0%, while mobile dropped 1.8%.
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Although cellulars represent 74% of América Móvil's accesses in Brazil, the number of fixed subscriptions increased 16.7% in 2012, more than mobile (8.0%).
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Claro had a smaller growth in 1st semester of 2012, but managed to recover in the 2nd semester leading net adds in this period. The carrier has shown disposition to gain market share in 2013 and fights for the leadership in net adds in the year. The operator was first in the offer of 4G in Brazil and wants to reinforce its brand as an innovative company.
High churn presented by Claro since 1Q11 can be a sign that the carrier is being rigorous when turning off inactive cellular subscriptions inside its base. Minutes of use (MOU) increased significatively in the same period, but ARPU continues to be low.
1Q11 |
2Q11 |
3Q11 |
4Q11 |
1Q12 |
2Q12 |
3Q12 |
4Q12 |
|
| Monthly Churn | 3.3% |
3.5% |
4.0% |
4.1% |
3.7% |
3.9% |
3.4% |
3.7% |
| MOU | 90 |
84 |
107 |
109 |
105 |
107 |
122 |
126 |
| ARPU (R$) | 19 |
17 |
18 |
17 |
17 |
16 |
15 |
16 |
The authorization given by Anatel for SeAC to Net in the end of 2012 will permitir the offer of cable TV in other cities. This Esta expansion may help to keep accelerated the growth inside Group's fixed segment (Embratel/Net) along 2013.
One important challenge for the Group in 2013 may be the improvement of profitability of its operations.
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The drop shown in EBITDA margin and EBIT in 2012 can be other factor to press the group to towards the merger of its mobile and fixed operations in Brazil.
You could ask:
Why does ARPU continue to be low? Aggressive offer? On-net calls?
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