www.WirelessFederation.com/news: Brazilian telecom market has grown by 16 percent year-on-year to reach 176 million by the end of last year and the sector continues to be dominated by its ‘big four’ players: market-leader Vivo, America Movil’s Claro, Telecom Italia’s TIM Brasil, and local operator Tele Norte Leste Participacoes (also known as ‘Oi’).
These four operators were the principle winners of the country’s first WCDMA (3G) auctions that took place at the end of 2007. But the future of the so called ‘Big Players’ does not seem to be very smooth as there are a number of new competitors all set to enter the telecom sector later this year.  However, there are possibilities that the existing players will be barred from bidding for further 3G spectrum when the local regulator (Anatel) sells-off the so-called

‘H-band’ WCDMA bandwidth later this year, paving the way for the arrival of the small players.
Some of the new comers almost certain to bid at these auctions is Nextel, the iDEN operator, France’s Vivendi, entered the Brazilian market last November via the US$4 billion acquisition of fixed-line broadband firm GVT, along with Telefonica’s Telesp and America Movil’s Telmex.

Till date, Brazil has only around 130,000 WiMAX subscribers and the WiMAX market is deemed to be suffering from a persistent shortage of spectrum and around 75 percent of 3.5GHz spectrum has yet to be released, while the use of mobility in 2.5GHz is restricted.

MVNO’s which are expected to be allowed into the market for the first time this year, can pose further competition. Carrefour, the Brazilian arm of French retail group has already confirmed its interest in entering the market via this route and other big names could follow.

But by the time, the small players make their mark in the sector and among the users the established players continue to play a dominating role. A 50/50 joint-venture between Spain’s Telefonica and Portugal Telecom and the market-leader Vivo surpassed the 50 million connections milestone in 4Q09 besides capturing over a third of net additions in the quarter (fourth-quarter additions accounted for 42 percent of Vivo’s total for 2009). By combining its mobile and fixed-line assets, second-placed America Movil is looking to ramp-up competition with fierce regional rival Telefonica while its Brazilian mobile arm Claro kept pace with Vivo during 2009.

Establishing coverage from scratch and reaching unconnected rural areas will not be easy.  Introduction of competition and establishment of rural 3G coverage having potential to disrupt the current status quo are some of the requirements for stimulating the market in Brazil. Race towards improving 3G coverage has also emerged as the key to unlocking additional revenue. To win the race, a clear set of tariffs and a streamlined portfolio will be necessary to enact any disruption in Brazil. Besides, there is a requirement for network-sharing agreements on a site or infrastructure level to lessen the financial blow.