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The economic turmoil in Brazil does not seem to have had a significant impact on the country’s mobile market, although that will change if conditions continue to worsen.
As explored in a new eMarketer report, “Mobile Brazil 2016: Forecasts and Key Trends,” Brazil invested in widespread network improvements prior to the 2014 World Cup soccer tournament, and that has continued as the country prepares for the Rio 2016 Summer Olympics. As a result, the number of 2G connections in Brazil has declined sharply, while 3G and 4G connections have grown rapidly.
Until recently, the country’s growing middle class was enthusiastically taking advantage of the improving mobile infrastructure. In 2014, the mobile phone internet audience increased 32.8%—among the highest growth rates in the world, eMarketer estimates.
But there are signs that Brazil’s economic struggles have slowed mobile growth or even reversed some of the gains in recent years. It is difficult, however, to gauge how much of Brazil’s mobile market has been affected by broader economic factors, given the paucity of information and the long delays for official data to be released (for example, key government data for 2014 was not published until April 2016).
eMarketer estimates the number of smartphone users in Brazil will total 64.0 million in 2016, the highest amount among the other countries in Latin America tracked by eMarketer. Smartphone user growth will amount to 17.9% this year and drop to single-digit percentages by 2019 as the audience continues to near saturation.
A variety of data sources point to mobile growth despite economic uncertainty. The “Spring 2015 Global Attitudes” survey from Pew Research Center found that the number of adults who reported owning a smartphone rose from 15% in 2013 to 41% in 2015. A separate February 2016 report from Cisco Systems estimated that the number of smartphone devices in use reached 134 million in 2015, and expected that total to jump to 221 million by 2020.
Globally, Brazil is currently the fifth-largest smartphone market behind China (531.7 million smartphone users), India (223.6 million), the US (207.2 million) and Indonesia (65.2 million), eMarketer estimates.
Because of high taxation on imports and the infamous “Custo Brasil”—a term Brazilians use to refer to red-tape costs—most smartphone makers offer a wide variety of affordable devices.
South Korea-based Samsung has built a sizable lead as the top mobile phone manufacturer in Brazil by user share thanks to a lineup peppered with plenty of reasonably priced devices. In a November 2015 survey from Mobile Marketing Association (MMA) conducted by Millward Brown and Netquest, more than one-third of mobile phone users between ages 14 and 55 cited Samsung as the maker of their primary mobile phone. Also offering a wide array of affordable devices, Motorola and LG rounded up the top three with 21% and 15% of respondents, respectively.
Apple’s high-end phones garnered just a 13% share. The company could see a decline in its share of Brazil’s smartphone users as competitors flood the market with low-cost devices.
Not surprisingly, Android is the dominant operating system in Brazil. According to the MMA study, 78% of smartphone users owned an Android device as of late 2015.
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