5G Technology Set to Boost Brazil’s Investment Potential

After few years of economic slowdown, Brazil is finally showing signs that a bright future is coming. To achieve solid and consistent economic growth, Brazil needs to make great strides in developing and supporting emerging industries. Currently, Brazil has clear company incorporation options and regulations to enable foreign businesses to become a part of this development.

Technology in the telecommunication sector will play one of the leading roles in this process with the introduction of 5G. We outline Brazil’s plans to introduce 5G to the country, and where the potential lies to invest in upcoming projects in this space.

5G spectrum auction in Brazil

5G is the newest generation of mobile technology in the world. The USA and several other countries have started to implement 5G technology. By 2026, 5G is expected to establish more than 1 billion connections in the world. 5G networks shall bring to users broader and more efficient coverage, more simultaneous connections, as well as, better data transfers.

In addition, It is expected that 5G networks will be able to deliver speeds 50 to 100 times faster than the current 4G technology.

According to the European 5G Observatory, “whereas 4G was conceived purely as a mobile broadband technology, 5G will have to be flexible enough to allow new services or business models to emerge”. Latin America as a region is under pressure to undertake the transition to 5G networks.

In order to implement this technology nationwide, each country defines a spectrum in the available frequency band. After that, providers that intend to explore the available frequency band need to attend a governmental auction to bid for that opportunity.

5G technology in Brazil will allocate the frequency band 2,3 GHz and 3,5 GHz. The Brazilian National Telecommunications Agency (ANATEL) is preparing to host what can be the world’s largest spectrum auction for 5G technology in 2020. In this sense, Brazil will be following Uruguay, which is the first country in Latin America to receive the 5G commercial network.

The implementation of 5G technology is a growing movement towards further technological advancement, and as soon as it is launched in Brazil, a chain reaction of business opportunities will come up.

Telecommunication and information technology in Brazil

Brazil is one of the largest countries in the world, with a total area of 8,511,000 square kilometers. Infrastructure projects will have a huge impact on technology in Brazil. To cover such an extensive area, Brazil will need to massively invest in infrastructure development. Such investment will necessarily involve the construction and installation of broadcast and network equipment to enable the transition from 4G to 5G technology.

Also, in order to obtain the best results for 5G technology usage, data centers need to be located closer to end-users. In this sense, the optimization of 5G technology in Brazil will require smaller data centers spread all over the country. There’s significant opportunity in construction works as a result of this implementation plan that businesses should keep a close eye on.

The initial success of the 5G auction also depends on how Brazil is going to prepare its structure for receiving the providers that will offer services to Brazilians based on this technology.

Smartphones market

With a population of 210 million people, Brazil has 230 million active mobile phones, according to a recent study by Fundação Getúlio Vargas (FGV). This number is set to increase in the coming years.

Technology in Brazil will inevitably follow the worldwide trend of 5G technology, which is one of the main drivers behind the increase in smartphone use all over the world. According to Gartner, the worldwide electronic devices market shall increase by 1.2% in 2020, which includes smartphones. Greater smartphone use and connectivity with 5G will mean an increase in Brazil’s already-booming mobile commerce market.

Application use in Brazil

In connection with 5G technology and smartphone markets, it is impossible not to mention the usage of apps by the Brazilian citizens.

In Brazil’s metropolis cities like São Paulo and Rio de Janeiro, people are now looking for convenience to make life easier in big cities. For this reason, there is a boom of service apps appearing in app stores. These apps cover a wide range of services offered to the public, including transport, courier, food delivery, language teaching, and several other key services. As Brazil’s middle class continues to grow and become wealthier, demand for services and higher-quality products will increase, validating the need for applications and online marketplaces that offer easier access to these services and goods.

However, Brazil still has a largely untapped market to be discovered by services apps in the advent of new technologies (i.e. 5G) that can take the end-user’s experience to higher levels.

Digital marketing and advertising

Another consequence of the growth of smartphones and apps usage is the development of digital marketing and advertising in the business scene.

The most successful digital marketing and advertising campaigns are developed by specialized agencies that have a solid understanding of the technology available in Brazil and evolving market trends.

Even under the adverse conditions of the Brazilian economy during previous years, digital marketing and advertising markets have shown positive growth and optimistic results for locally-based businesses. Considering what is coming with the arrival of increased connectivity in Brazil, there is a wealth of opportunity for new arrivals to the online market.

The future is coming fast

As 5G technology is getting ready for introduction in 2020, Brazil must be ready to accomplish the objective of connecting its population over its vast territory. From telecommunication infrastructure to digital marketing and advertising, Brazil has a real chance to obtain a leading role in Latin America’s 5G development.

Brazil is expecting to approve some important tax and social security systems reforms by the end of 2019. This is certainly a crucial step to attract more investors and maintain its economic stability. Brazil has some powerful projects that are linked with the development of 5G technology. These projects have the potential to lift the country’s economic performance and the commercial prospects within it for business.

Let us help you get started

Brazil offers an advantageous commercial platform for trading and expanding into Latin America. Greater local opportunities are set to emerge as a consequence of the 5G auction in 2020. The best way to benefit from such opportunities is to focus on expanding your business.

Before you get started in Brazil, we strongly recommend partnering with accounting and legal experts for local support. With the right market entry strategy, your Brazilian expansion can achieve long-term success.

To learn more about the Brazilian economy, the business opportunities to form a company in Brazil, and how you might take advantage of these political shifts, please contact us today.

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