01/02/2017
What to monitor in 2017
After a year considerated as bad/terrible for 47% of the people who answered Teleco’s poll, the expectation of 57% is that 2017 will be better or much better to the sector. For only 12% the year will be worse than 2016.
This result reflects the expectation of resumption of economic growth in 2017 and the advance in regulatory changes necessaries to promote a new cycle of investments in the sector.
The following shows the trends to be monitored in the year.
- 4G was consolidated as the technology that offers the speed that supplies users’ expectations, providing better experience. Accelerated growth made 4G accesses overtake 2G in 2016 and may surpass 3G in 2017, becoming the main mobile technology of the country.
- 4G coverage will become denser with the use of 700 MHz frequencies and others, besides 2.5 GHz, and will reach cities with population between 100 and 30 thousand inhabitants in 2017.
- VoLTE (Voice over LTE) is likely to become available in 2017.
- According to the expectations Oi will reach an agreement with its creditors in the 1st semester of 2017, approving a plan to lead to its exit from judicial recovery.
- Any merger or fusion operation is more likely to left to 2018, after negotiation with Anatel over the migration to fixed telephony authorization.
- The transition from voice to data will continue in 2017 with TIM and other companies registering bigger revenue in data than in mobile voice, as what already happens to Vivo.
- The intensive use of messaging apps like WhatsApp will continue to stimulate the abandonment of the 2nd chip and the reduction of prepaid base.
- Impacts of the economic crisis
- Brazilian economic crisis will continue to impact in the growth of fixed broadband and postpaid in 2017. Pay TV and fixed telephony will continue to present negative growth in the year. However, there is expectation that these rates will become stable in 2017 and resume growth in 2018.
- Changes in the regulatory framework
- The approval of PL3453 may drive to an important change in the Brazilian regulatory framework, with the migration of the fixed telephony concessions to authorization. The definition of the terms in which fixed telephony obligation will be replaced by investments in broadband will probably happen along the whole year. News changes may occur in 2017 with Anatel and Minister being more active.
- The high and growing tax burden on Telecom services should be one of the hot topics of 2017. The sector may mobilize to avoid growth in ICMS aliquots promoted by states and find solutions to reduce it. The use of the money from FUST for investments is also an issue.
- Switch off schedule for 2017 is being reviewed considering the experience acquired by the switch off in Rio Verde and in Brasília. In 2017 are stablished the analog TV switch off in São Paulo and Rio de Janeiro.
- Internet of things will be one of the hot topics in 2017, when the first NB-IoT (Narrow Band IoT) networks can start to operate in the country.
- BNDES may conclude the study that will be used as base for the IoT National Plan.
- There is no expectations for big changes in the competition scenario in 2017.
- Nextel can be sold to any group from Brazil or abroad.
- The approval for the acquisition of Time Warner by AT&T can result in the sale of SKY in Brazil due to regulatory problems.
- On of the points to be alert is the operators' performance in hearing their clients through apps improving relationship experience with consumer. Nextel launched the "Happy" and other operators are working on solutions like this.
Besides these topics, it's interesting to monitor the digital transformation operators are going through with Network Functions Virtualization (NFV) and Software Defined Networks (SDN), the advance in 5G specifications, growth of video streaming offers and new MVNOs that can operate in Brazil.
You could ask:
- Will 2017 be better for the Telecom sector in Brazil?
- Will 4G overtake 3G in 2017?
- Will Oi get over its judicial recovery in 2017?
- Will prepaid base continue to shrink in 2017?
