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Oi Telecom Essay

695 words - 3 pages

OI Telecom

Oi’s profile of activites covers a broad range of communications products. The company offers fixed and mobile telephony as well as internet services (ISP and broadband) to private and corporate clients including other telecoms companies in Brazil. The balance shows a high percentage of cash flow generation through their wireline operations and a smaller percentage of the high-growth services mobile and broadband[1].
Brazil’s telecom market changed rapidly after the privatisation of state owned companies in the late 90’s last century. Today approximately 300 Internet Service Provider compete in the brazilian internet market. Although the first broadband connections were ...view middle of the document...

An average Brazilian employee salary for 3 days of work equals the cost for the setup of a new telephone line. Table 2 shows the 2 per cent decline from 2003 to 2007[3].

Table 2: Telephone main lines 2003-2007

Having a look at the mobile sector in Brazil one might notice 8 operators with 4 large companies and 4 regional firms with limited concessions. In 2008 Oi and Vivo acquired 2 of the smaller companies reducing the competition in the market. Furthermore Oi bought Brasil Telecom in 2009 in order to strengthen their possibilities in market access and market share[4].
As shown below in table 3 the number of mobile subscribers increased steeply from 2003 to 2007. In 2008 already 133 million Brazilians subscribed for a mobile and in the first term of 2009 the number of subscriptions amounted to 159,6 millions.
Table 3: Mobile subscribers 2003-2007

Analysts say the largest mobile market in Latin America will still continue to grow in the second half of 2009. They expect the number of subscribers at the end of 2009 to be between 165 and 175 million which equals a penetration rate of 85,9 %.
Vivo as the market leader holds 29,3 % share of mobile phone subscribers. On second place is Claro with a 25,4 % share...

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