The new landscape for TV in Brazil

Antennas in the background at Av. Paulista, in São Paulo.

Antennas in the background at Av. Paulista, in São Paulo.

Brazilians show some of the highest rates of engagement with TV content in the world. This is a country where, for decades, the medium of television has come close to being consumed by the entirety of the population, and the introduction of new technologies has done little to change this behaviour.

Research from the Brazilian Federal Government found that, as of 2015, 73% of Brazilians watched TV seven days per week, a rate that increased from the 65% found in the previous year. Only 4% of the population did not watch television at all. It should be noted that this research was conducted during the same year where the penetration of residential and mobile broadband connections, subscription of OTT content and consumption of digital content expanded substantially in the country.

Along with the dissemination of new technologies, recent years saw the consolidation of the national economy and the ascension of the “C Class”, the expanding Brazilian middle class. If anything, these factors combined may have actually encouraged the country’s viewers to keep watching TV at the high rates found during the pre-internet era.

What has actually changed over the last few years is the infrastructure used for the broadcast of TV signals in the country and the possibilities provided by new systems and technologies. In these regards, the sector of TV in Brazil displays an entirely unprecedented landscape, and opportunities for technology providers have never been greater.

The Brazilian Digital TV System

With the introduction of the Brazilian digital TV system, known as SBTVD, in 2007, the segment of over-the-air television broadcasting underwent a full end-to-end renovation. The Brazilian system was developed with goals that included the ability for the transmission of high-definition content in indoor environments and enabling viewer interactivity. To that end, it borrowed the structure and many features from the Japanese terrestrial TV systems but also brought along many technologies developed nationally.

One special feature of the Japanese TV system that was successfully imported to the Brazilian market was the capability to broadcast content to mobile devices, using a technology known as 1-Seg. This lower bandwidth standard has been implemented to a number of devices commercialized in Brazil, in particular smartphones, tablets and GPS equipment, and the overall adoption of mobile television has increased substantially in the country.

At first, the Brazilian digital TV system was developed as means to turn television sets into the main devices for the population to get access to relevant content and interact with systems such as e-government and online shopping. The solution adopted for this end was the locally developed middleware Ginga, which has been implemented in all TV sets and digital signal converters commercialized in the country since 2013, but yet struggled to gain the attention of the general public due to the high latency of its services and limited capabilities.

Perhaps the greatest triumph of SBTVD was to change the way the country’s population watched television down to the level of the type of equipment used for the consumption of this medium. Ever since the introduction of the digital TV system sales of high-definition television sets soared, and these sets are currently close to being the default equipment found in Brazilian households.

What has turned into an issue for the Brazilian government is how many of the country’s homes are still reliant on standard-definition sets and analogue transmissions, as the shutdown for traditional over-the-air TV broadcast is planned to take place from 2015 to 2018. Data from 2015 by IBGE, the Brazilian Institute of Geography and Statistics, indicates that close to 28% of households still receive analogue over-the-air signals.

One solution adopted by the government was the distribution of digital signal receivers to close to 14 million beneficiaries of the assistential program Bolsa Familia, a measure that is expected to broaden the rate of adoption of digital TV systems by lower income households.

Paid TV Technologies and Adoption

Although the segment of over-the-air television has maintained its relevance in Brazil, the market for paid TV has not displayed signs of accelerated expansion during the last few years. Data from Anatel, or the Brazilian Telecommunications Agency, indicates that during 2014 the subscriber base of paid TV services grew by only 8,6%.

The current most popular technologies used for subscription TV in Brazil are satellite transmissions, or Direct to Home broadcasting, which has been popularized due to its availability in regions where cable TV services are not offered. According to statistics from April 2015 by Anatel, 60.5% of paid-tv subscription used satellite technologies, while cable technologies took part in 38.7% of subscriptions.

One recently deployed technology which has rapidly gained traction in the country’s market are fiber connections, or Fiber to the Home, used for broadcasting of IPTV. The offering of fiber connections remain limited to some large city centers in Brazil, but even within such markets these connections were able to expand their reach by 30% during 2014 and currently gather 0.6% of paid-tv subscriptions.

As Brazilian carriers, the providers of both broadband connections and paid tv services, plan to keep the investment in the country’s telecommunication infrastructure, the subscriptions for paid TV that make use of these recently deployed technologies such as IPTV and Fiber to the Home are expected to expand in the country over the next few years.

Innovation Norway is responsible for promoting the Norwegian industry abroad. Our office in Rio de Janeiro manages Innovation House Rio, our business incubator office, and helps Norwegian companies in their efforts towards the Brazilian market.

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Posted in ICT

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