5 facts about telecom in 2020: 5G, IPTV, sale of Oi Mobile and more | Telecommunications

It looks like it took about five years, but finally 2020 is about to end. The internet was already very important in the life of (almost) everyone, but the COVID-19 pandemic ended up changing the direction of different sectors that needed to digitize in a way never seen before. There was an increase in the search for entertainment during the isolation period, the 5G auction was pushed aside and Oi Móvel was sold. You can tell that this was an intense year for telecommunications.

1. I had a pandemic halfway

It was January and we started to hear rumors about a coronavirus in China. We Brazilians followed our normal life, we skipped Carnival while Europe was already starting to close and, well, it didn’t take long and we ended the month of March with social isolation in Brazil.

Home office was the solution to continue working in the pandemic (Image: StockSnap / Pixabay)

People stayed at home, but continued to work because of the internet. At that time, the telephone operators made efforts to make the customer’s life more pleasant, including easing the payment of the invoice, extra bonuses on the 4G internet, freeing up channels on pay TV and even increasing speed on broadband.

2020 put the capacity of operators to the test. The government itself recognized that the internet is considered an essential service. To better support simultaneous use, services like Netflix and YouTube reduced the quality of videos to improve traffic in Europe and make the connection work better for those who needed to work at home.

Even so, the service was not suitable for everyone: Anatel registered a 31.8% increase in complaints about fixed internet in the annual comparison – here it is worth mentioning Claro, which had twice as many complaints with broadband NET Virtua. The most talked about subject was slowness or reduced speed.

We are even more dependent on broadband connections. So, I hope that the operators forget that history of use franchise for good.

2. The year of IPTV

People started to use broadband even more for entertainment, and IPTV was a topic widely commented in 2020. In that year, Anatel, the Federal Revenue Service and other copyright organizations closed the siege against piracy.

Equipment seized by Anatel. Photo: Disclosure / Anatel

Equipment seized by Anatel. (Photo: Disclosure / Anatel)

An important milestone was Operation 404, which shut down more than 300 illegal IPTV services that served 26 million people. Unapproved TV Box sets were also targets of destruction and seizure.

But IPTV does not live by piracy alone, because it is a technology that is also used by legitimate services. Anatel’s understanding that linear internet channels do not fit into the traditional pay-TV legislation allowed the arrival of services such as Claro Box TV and DirecTV Go.

3. A profound change in the broadband market

Small providers were instrumental in the expansion of broadband in Brazil: from January to October 2020, small providers added at least 2.2 million customers and reached the mark of 12 million contracts, of which more than 70 % are connected via optical fiber.

Fiber optic internet provider rack. Photo: jarmoluk / Pixabay

Optical fiber is the most used technology for broadband in Brazil (Image: jarmoluk / Pixabay)

This means that together, the local providers can be bigger than any major operator. They meet a repressed demand, where traditional companies do not reach or use outdated technologies, such as ADSL.

With national coverage, it is difficult for Claro, Oi, TIM and Vivo to follow the investments of several providers. In order not to lose (even more) relevance in the market, some operators are betting on the expansion of optical fiber with a neutral network model, which allows multiple providers to share the infrastructure.

The protagonist in the matter is Oi, which adopted a structural separation model and created InfraCo, valued at R $ 20 billion. Tele will sell 51% of this new company, and the partnerships should bring more impetus to continue expanding Oi Fibra. TIM and Vivo also sympathized with the model and are expected to announce new partners during 2021.

4. The first steps of 5G in Brazil

The frequency auction for 5G was scheduled to take place this year, but as I said earlier, there was a pandemic in the middle of the road that ended up delaying the whole process.

We still do not know exactly when the auction will happen: the Minister of Communications, Fábio Faria, said that the event will still take place in the first half of 2021; on the other hand, an Anatel board member maintains the expectation for the 2nd semester due to regulatory bureaucracies. In addition to the delay, operators fear a possible restriction on Huawei equipment, which would make building the new network much more expensive and time-consuming.

iPhone 12 Pro Max (Image: Paulo Higa / Tecnoblog)

iPhone 12 Pro Max connected to Claro’s 5G DSS (Image: Paulo Higa / Tecnoblog)

Even so, the delays in the auction did not prevent the use of 5G by operators in Brazil, even if in an experimental phase. Thanks to DSS technology, which allows dynamic spectrum sharing, Claro, TIM and Vivo activated the fifth generation network in some Brazilian municipalities using 2G, 3G or 4G licenses. Oi was bolder and dedicated part of the frequency to 5G, which is available in Brasília.

The first results of the 5G DSS are not encouraging: in practice, coverage is very restricted and the speed is similar or even worse than that of 4.5G. Claro makes a lot of publicity about the new network, while Oi, TIM and Vivo are more restrained and hardly divulge the technology.

5. Saying goodbye to Oi

To close the year, Oi Móvel was sold to competitors Claro, TIM and Vivo. The market had been speculating for some years about market concentration, which finally happened.


Oi Móvel was sold to Claro, TIM and Vivo (Image: Disclosure / Oi)

The trio of operators paid R $ 16.5 billion for Oi Móvel, and the main buyer is TIM, which will spend R $ 7.3 billion for 14.5 million customers and 49 MHz of spectrum. Vivo will have 10.5 million users and 43 MHz of capacity, while Claro will absorb 11.7 million lines and no radio frequency license.

The business still needs approvals from Anatel and the Administrative Council for Economic Defense (Cade), and the expectation is that the proceedings will end at the end of 2021. If all goes well, Oi should put into practice the strategic plan focused on fiber optics and end the judicial reorganization process, at the expense of reducing competition from mobile telephony in Brazil.

What to expect from telecommunications in 2021?

2021 will be a decisive year for telecommunications: in addition to the 5G auction, an outcome is expected on whether or not to ban Huawei equipment in Brazil. With the change in the presidency of the United States, it is possible that the Clean Network project will not go forward and the Chinese supplier would have an open path to negotiate in more locations.

The next year should also bring news of internet via fiber optics: TIM, Oi and Vivo should put into practice the construction of their neutral networks that, with partners, should expand broadband in several regions of Brazil. On the other hand, small providers remain strong and will play an important role in connecting places where access is precarious.

Finally, I hope that legitimate IPTV takes off even more: we’ve already had samples from Claro and DirecTV around here, but nothing prevents new Internet TV services from emerging to meet the demand for entertainment at a lower cost than traditional pay TV .

And you, what do you expect about telecommunications for next year? Tell us in the Tecnoblog Community!

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