Democratizing Technology in Brazil: Basic Access

I'm starting a new series about the democratization of technology in Brazil, and I'm kicking it off with a post on basic access.

Though Brazil is one of the world's largest economies with one of the largest populations of internet users, there are still a surprising amount of people with limited or no access to the Web. A recent study from F/Radar found that only 51 percent of Brazilians 16 years and older access the internet, and this percentage grew by only 4 percent since 2008, indicating a "stagnation" in internet usage.

Still, there was an expansion in access. The most recent numbers from IBOPE show that 77.8 million Brazilians accessed the internet this quarter, a 5.5 percent increase from the same period last year and a 20 percent increase from the second quarter of 2009. It also revealed that Brazilian internet users spent an average of 69 hours online last month. An increase in number of users and a rise in hours spent online per month reflect year to year trends, as we'll see below.

From 2008 to 2011, home internet access grew from 21 percent to 29 percent of the population, and home broadband access grew from 12 percent to 31 percent. Also, there was an increase in daily internet usage: in 2008, 32 percent of users accessed the internet daily, compared to 41 percent in 2011. An annual study by CETIC, the Center for Technology and Information Studies, found similar results for 2010. It found that home internet access reached 31 percent in 2010, though that's around 60 percent less than home internet access rates in Germany and Japan. The study also found that of those who accessed the internet in the last 3 months, 60 percent access the web daily, meaning that 1 in 4 Brazilians over the age of 10 use the internet each day. Of those internet users who access the web daily, 56 percent accessed it from home, 27 percent from someone else's house, 22 percent from work, and 35 percent from lan houses (internet cafés). Brazilian internet users spend a lot of time online - in May 2011, Brazilian internet users spent an average of 48 hours and 17 minutes online, more time than in any other country, according to an IBOPE Nielsen study.

Yet there's still a class divide in access. According to the F/Radar study, 62 percent of the A and B classes now have a fast internet connection at home, compared to only 22 percent of the C class and 4 percent of the D and E classes. While members of the A and B classes use the internet an average of 5.3 days a week, members of the C class only use the internet an average of 3.7 days a week, and members of the D and E classes use it an average of 2.8 days a week. According to the CETIC study, 90 percent of the A class had home internet access in 2010, compared to 24 percent of the C class and 3 percent of the D and E classes. There was also a geographic divide: 36 percent of households in the Southeast had home internet access, compared to 11 percent in the Northeast.

The first key to expanding internet access is being able to afford a computer. President Dilma has made it a priority of her administration to decrease the price of electronics, particularly computers and tablets. Just this week, she announced her goal to have broadband internet in 40 million households, or 70 percent of the population, by 2014. With a strong real, high demand, and the ability to pay in installments, computers have become more affordable, despite continually inflated prices (and taxes) for electronics. According to the F/Radar study, 44 percent of Brazilian households had at least one computer in April 2011, a four percent increase from the same period the year before. Brazil is now the third-largest market in the world for computers, and 7.46 million computers were sold in Brazil this year alone. Over 50 percent of the computers sold in the second quarter were desktops, but laptop sales increased 27 percent in the second half of 2011, compared to the same period in 2010. On the Casas Bahia website, a popular electronics store, one of the cheapest available PCs with a monitor was R$699 (about US$416).

The next step is to make internet access more affordable. Taxes account for a large percentage of costs of internet plans, sometimes amounting to more than 30 percent of the total plan. To give an example of costs, NET, one of the major providers, has monthly plans that start at R$55 for 1 mega, R$130 for 10 mega, R$180 for 20 mega, and R$400 for 100 mega. In an effort to lower costs, the Brazilian government launched the National Broadband Plan in June, which is being rolled out across the country. The plan would create internet packages between R$29.80 and R$35 per month for a connection of 1 megabyte per second. Some companies have already begun offering the plan, like Claro, which is offering R$29.90 per month for 1 megabyte per second using a modem, which must be purchased separately. (The modem costs at least R$70.) TIM will have a similar plan this month, at R$35 a month, and NET is now offering a R$30 a month plan for 512 kilobits per second (less than 1 mega). Even without the plan, costs have been gradually coming down, and more members of the C and D classes now have broadband access; according to a Telefónica exec, 75 percent of new broadband plans in the past six months were purchased by those in the C and D classes.

But there are catches to expanding access. Anatel, the national telecommunications agency, wants to charge extra for "heavy users" and to tax companies like Google, Facebook, and Apple that involve high data loads and can saturate networks. As for the National Broadband Plan, there will likely be limits. The plan includes a download limit of 300 MB per month, and possibly lower quality service than higher paying plans. The plan isn't fully national yet, and coverage is by city, and only a certain number of cities are offering or plan to offer the low cost plan.

Traditionally, expensive internet plans and computers led to the creation of lan houses, or internet cafés, where people could access the internet quickly and cheaply. They later became a popular place for gamers, especially younger players. But even with the expansion of internet in homes, lan houses are still important -- according to a recent TNW article, there are nearly 100,000 lan houses in Brazil that serve between 30 and 35 million internet users. These small businesses aren't just important for low-income communities, but also rural areas. The government is exploring plans to expand high speed internet by satellite to lan houses in rural areas, particularly near schools.

Another method to avoid expensive internet plans is to use open Wi Fi connections. But it's illegal to share a Wi Fi connection unless you have a private license, which costs R$400. There have been cases in which Anatel and the police have actually confiscated computers that share Wi Fi and charged fines for thousands of reais. Though it's on a small scale, it's quietly occurring with very little media coverage.

In short, falling prices for computers and internet access have allowed millions of Brazilians to connect to the Web, and with new legislation and cheaper plans, even more will have access. But a visible gap still exists between social classes, as well as urban and rural dwellers, and it will be a continuing challenge to expand access and to improve quality of service. As millions of people gain regular internet access for the first time, an enormous opportunity exists not only for businesses, but also to democratize a fundamental service and what is now considered a basic human right.

Comments

[Peter]

An Al Jazeera English story on YouTube.com about this subject:

http://youtu.be/zjRrdPxmd7c

[stephen]

Does anyone know if it would be illegal to bring a wireless router and either net cables to Brazil?