![Brazil Brazil](https://cdn-www.bnamericas.com/img/flags/BRAZIL.jpg)
Crisis projected to halt mobile postpaid growth
![Crisis projected to halt mobile postpaid growth](https://cdnimg.bnamericas.com/FozkTvpQogcrgmsGHkisHmsVLmlDoZEkvhEALyMwNIhPNmPEBKeIgWAJMihpTaPT.jpg)
The mobile segment, not just in Brazil, will become less profitable as the economic crisis triggered by the COVID-19 pandemic will halt the migration of lower margin prepaid clients to higher added-value postpaid plans.
This migration has been a trend over the last years and its expected end will impact medium-term revenue generation, according to KPMG consultancy.
In March, 226mn mobile lines were in service in Brazil, of which 114mn were prepaid and 112mn postpaid, according to regulator Anatel. Postpaid subscriptions grew by 10mn year-over-year, while prepaid fell by over 12mn.
In an online conference on Tuesday on how the pandemic will influence the telecom industry, KPMG analysts said the impact will mainly be seen in revenue predictability, since postpaid is a recurrent source but prepaid consumers recharge only when convenient.
The experts, however, said it is still difficult to predict if massive plan downgrades will occur, as happened during Brazil’s 2015-16 recession.
In its latest report, Fitch Ratings said telecoms “will not experience the same disruption as other sectors but the outbreak will slow the migration from lower-margin prepaid to higher-margin postpaid mobile service and will scale back handset purchases and pay TV services due to reduced discretionary spending.”
According to Fitch, Latin American telcos could cut capex by up to 30% to cope with the cash burn resulting from the economic fallout.
Oliver Cunningham, KPMG partner of Digital Transformation, however, said the world that will emerge post-pandemic will be even more digital and connected and, therefore, telecom will play a leading role, which opens an important scope for strategic repositioning.
KMPG’s analysts said operators will have to establish strategies to deal with the expected increase in defaults.
And telcos will have to accelerate their own digital transformation and invest even more in digital channels and robots, among others.
Subscribe to the leading business intelligence platform in Latin America with different tools for Providers, Contractors, Operators, Government, Legal, Financial and Insurance industries.
News in: ICT (Brazil)
![Serpro to invest over 70% of the 1bn reais planned for Brazil's sovereign cloud infra](https://cdn-www.bnamericas.com/img/sectors/ict_1.jpg)
Serpro to invest over 70% of the 1bn reais planned for Brazil's sovereign cloud infra
The company announced its cloud in November 2023 – the only one considered sovereign in the southern hemisphere.
![IBM, TD-Synnex target AI with new development center for LatAm](https://cdn-www.bnamericas.com/img/sectors/ict_2.jpg)
IBM, TD-Synnex target AI with new development center for LatAm
Located at IBM’s São Paulo headquarters, the so-called center of excellence will operate integrated remote hubs and centers maintained by both comp...
Subscribe to Latin America’s most trusted business intelligence platform.
Other projects in: ICT (Brazil)
Get critical information about thousands of ICT projects in Latin America: what stages they're in, capex, related companies, contacts and more.
- Project: SP04 Data Center
- Current stage:
- Updated:
2 days ago
- Project: Norte Conectado Program (Infovia 04)
- Current stage:
- Updated:
1 week ago
- Project: Manage Engine Data Center in São Paulo
- Current stage:
- Updated:
1 week ago
- Project: RIO2 Data Center (RIO1 Expansion)
- Current stage:
- Updated:
1 week ago
- Project: SP4 Data Center Expansion (Phase 4)
- Current stage:
- Updated:
1 week ago
- Project: CloudHQ Rio de Janeiro data center (GIG Campus)
- Current stage:
- Updated:
2 weeks ago
- Project: Humboldt Project (Trans-Pacific Submarine Cable, Asia-South America)
- Current stage:
- Updated:
3 weeks ago
- Project: Norte Conectado Program (Infovia 02)
- Current stage:
- Updated:
1 month ago
- Project: Norte Conectado Program (Infovia 08)
- Current stage:
- Updated:
1 month ago
- Project: Norte Conectado Program (Infovia 06)
- Current stage:
- Updated:
1 month ago
Other companies in: ICT (Brazil)
Get critical information about thousands of ICT companies in Latin America: their projects, contacts, shareholders, related news and more.
- Company: Telefônica Brasil S.A.  (Telefónica Brasil)
-
Telefônica Brasil S.A. is a publicly-traded Brazilian telecommunications company providing fixed and mobile voice, fixed and mobile broadband, ultra-broadband, data and digital ...
- Company: Stefanini IT Solutions S.A.  (Stefanini IT Solutions)
-
Stefanini IT Solutions S.A. is a Brazilian multinational firm providing IT services, digital marketing, business, financial and human resources; and mobility, personalized campa...
- Company: Greatek Brasil
-
The description contained in this profile was taken directly from an official source and has not been edited or modified by BNamericas researchers, but may have been automatical...
- Company: Brisanet Telecomunicações S.A.  (Brisanet)
-
The description included in this profile was taken directly from an official source and has not been modified or edited by BNamericas’ content team. However, it may have been au...
- Company: PPLink
- Company: Ausenco do Brasil Engenharia Limitada  (Ausenco do Brasil)
-
Ausenco do Brasil offers engineering, studies and projects, geotechnical, administration, inspection and planning services for the mining and metals, oil and gas and industrial ...
- Company: NUV
- Company: Sonda do Brasil S.A.  (Sonda Brasil)
-
The description contained in this profile was taken directly from an official source and has not been edited or modified by BNamericas researchers, but may have been automatical...
- Company: Consórcio Sonda Infovia Digital
- Company: Veolia Water Technologies & Solutions - LATAM
-
With operations in 130 countries and over 10,000 employees worldwide, Veolia Water Technologies & Solutions (formerly SUEZ WTS) solves the toughest water, wastewater and process...