4 Market realities that every small and medium provider needs to know
There are currently 4 essential realities in the internet service provider (ISP) market. It is important to observe both internal points – our own company – and external points – the market in which we operate. Internally, we have help from OZmap to generate intelligent information from georeferencing. OZmap outlines the entire provider network and reproduces updated data to optimize management and important decisions. Now, for the external environment, we highlight 4 essential topics in the current market. Check out:
1 - The internet provider market is dominated by small and medium providers
In recent years, small and medium-sized providers have been dictating the pace of expansion of broadband services in Brazil. “Half of the fiber optic connections in the country are in the network of regional providers”, confirms Basílio Perez, President of Abrint. Basílio highlights that “fiber optic technology has become much cheaper” which has boosted this growth. In 2018, fixed broadband based on fiber optic technology reached 5.19 million connections.
The Survey released in 2018 by the Internet Steering Committee (CGI.br) shows that in the previous year (2017), 78% of internet providers in the country provided broadband connections, almost 30% more than recorded in 2014. According to the expert Carina Gonçalves, senior consultant at Frost & Sullivan, “Some local players have grown large enough to provide connectivity entirely with their own network, especially in underserved locations.” This growth has attracted significant investment funds to “expand and modernize its networks, as well as develop new services beyond connectivity, such as data center and cloud computing”. According to CGI.br, the total number of internet access providers active in the country jumped from 4,204 to 6,618 between 2014 and 2017 – an increase of 57%.
2 - Regional fiber optic provider market to move US$1.45 billion
Competitive, billion-dollar and increasingly favorable to companies focused on local customers: this is how the Brazilian broadband internet market has come to fruition, according to data from various consultancies, regulatory bodies and sectoral entities. According to a study by Frost & Sullivan, total revenue from telecommunications services in Brazil will exceed US$ 45 billion in 2022, well beyond the US$ 38 billion measured in 2016. Broadband is the main driver of these gains.
The segment of regional providers (ISPs) has grown above the large telecommunications operators. In 2017, around 1.91 million new broadband contracts were signed in the country by regional providers. An Anatel study that evaluates this market from 2007 to the end of 2018 shows that the number of fixed broadband subscriptions increased by 276% in Brazil, while large Telecommunications are losing space. Anatel assesses how Small Providers (PPP) have been expanding at a strong pace: today, most municipalities, 78.2%, have five or more active ISPs. The largest operator present in the country fell from 42.6% in 2007 to 19.2% in 2018. The second largest reduced from 28.1% to 24.3%.
3 - Study proves that 83% of new accesses came from regional internet providers
The expansion of regional providers was even greater in regions that were previously dominated by large operators: in the Southeast, they were responsible for 83% of total new accesses; in the South, by 73%; Central-West for 69% and North for 55%, according to data from Anatel. Localized operation attracts more subscribers, leaving only 17% of all space for large operators.
To better understand this expansion, we just need to analyze the Northeast where regional operators had a growth of 104%, with 380,516 new accesses, while the large operators lost 17,856 accesses from their base, during the period from January to December 2018.
4 - Fiber optic market continues to grow
“Optical fiber continues to grow and bring connectivity to different parts of Brazil”, comments Basílio Perez, director of ABRINT. It is known that in 2018 it became the favorite method of home internet connection, 138 new Brazilian cities registered new accesses through the format.
The states with the highest fiber density are: Acre, Ceará, São Paulo, Rio de Janeiro, Paraná and Santa Catarina, in addition to the Federal District. All with 80% to 100% in cities served by fiber technology. Piauí, with 20%, is the state with the lowest density, but which does not escape the exponential growth of optical fiber.
With this data it is possible to obtain several insights on how to position yourself in the provider market, but are you clear on the current situation of your network? What are the best actions to take? What are the needs of your customers and potential customers in your region and how can you meet them? If you have any doubts when answering any of these questions, we can help you! Send us a message and one of our experts will contact you to guide you. Or try our OZmap system now!
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