Rio Gringa

On Break

I was hoping to get in a really interesting profile piece and a post about real estate this week, but as it turns out I've been much busier than I anticipated while on vacation with limited internet access, so I hope to get one post out this weekend. If not, I will be back next week with lots of great new posts. Thanks for your patience!

This Week's Reads

It's been a busy week, and I'm going on vacation tomorrow, so I apologize for the sparse posting. But there should be two really interesting posts up next week!

Here are some good reads I came across this week, which you can also see on Twitter.

Being There: São Paulo, More Intelligent Life

A great piece about a foreign correspondent adjusting to life in São Paulo.

Excerpt: "Still, São Paulo is a great place to be seeing out the global recession. Brazil’s economy is booming, and much of the benefit is being experienced lower down the income scale. My boss...who lived in São Paulo in the late 1990s, says that better diet and greater self-esteem mean that poor Brazilians stand noticeably taller now. One private-equity dealmaker told me his family’s maid and nanny have both started to sell cosmetics door-to-door in the evenings. He doesn’t think either will still be with him in six months. To hear a Paulistano complaining that you can’t get a good maid these days is to be reminded of Bertie Wooster’s constant fear that one of his friends would poach Jeeves. São Paulo is in the throes of a full-blown Servant Problem, and I feel privileged to witness it."

In Pockets of Booming Brazil, A Mint Idea Gains Currency, Wall Street Journal

A fascinating story about the growth of local currencies in Brazil. I'd read about the Cidade de Deus bills, but didn't realize it was a national phenomenon.

Excerpt: "The capivari is one of 63 local moneys—including bills named after the sun, cactus and the Brazil nut—now circulating in needy neighborhoods throughout Latin America's biggest economy. The idea is gaining currency as towns seek a share of current economic growth. This month, a new local currency hit the streets in Cidade de Deus, the Rio slum that was the subject of a blockbuster film and a stop on President Barack Obama's South American tour this year. While equal in value to the real, local currencies gain traction because local merchants offer discounts when using them. No one is forced to quit the real, but shopkeepers say greater volumes make the markdown worthwhile."

How Brazil Is Sending 75,000 Students To The World's Best Colleges, TIME

An interesting piece on the Brazililian government's study abroad plan.

Excerpt: "With their economy booming...Brazilians have gotten used to going abroad for tourism, business, shopping and diplomacy. Now their students are finally getting an incentive to see the world, thanks to a major government program that aims to award 75,000 scholarships to attend the world's top universities. Available only to Brazilians studying subjects of strategic national importance, like engineering, they reflect 'an effort by the government to take a quantum leap in the formation of a scientific and technological elite,' says Aloizio Mercadante, Brazil's Science and Technology Minister."

Foreigners in Brazil, Ultimo Segundo

A story about foreigners living in Rio, accompanied by a really interesting infographic of how many foreigners live in each state in Brazil, as well as the number of foreigners by country of origin. The numbers allegedly come from the Ministry of Justice, though some of the countries seem a bit odd (Antarctica? Undefined? Countries that no longer exist?)

In Rio de Janeiro, Juice Bars Are More Than Just Juice, The New York Times

Seth Kugel covers one of my favorite Rio institutions: the juice bar.

Excerpt: "Here’s the key [to cheap eats]: the city’s freewheeling, fast-moving corner juice bars, where countermen take your order and appear to yell it — “orange with papaya, no sugar!” — into a wall of pineapples, guavas, apples and mangoes. A minute or two later, a glass appears from an opening in the wall, filled with ice-cold, frothy, delicious juice. You down it at the counter, and head off to the beach."

Brazil has slower average Internet speeds than in Haiti, says study, Folha

A study of internet speeds across the world found that average internet speeds in Brazil were lower than in average speeds in Haiti, Niger, Ethiopia, Angola, Pakistan, and Papua New Guinea.

Graphic from Pando Networks

The Completely Outrageous Cost of Living in Brazil, Business Insider

An interesting round up of twelve items and services that have high price tags in Brazil.

Dilma in the Spotlight

President Dilma arrived in New York on Sunday for the United Nations General Assembly and to meet with a number of world leaders, including President Obama, UK PM David Cameron, French president Nicholas Sarkozy, and Mexican president Felipe Calderón. On Wednesday, she will become the first woman in history to open the General Debate at the UN. She will accept the Woodrow Wilson Award for Public Service on Tuesday, following in the footsteps of her predecessor. The same day, she will launch the Open Government Partnership with President Obama. And this week, she's on the cover of Newsweek, and featured in a story called "Don't Mess With Dilma." Here's an excerpt, and read the full story here.

"...But Rousseff’s day was far from done. Flash floods in the south had left thousands homeless. Construction work for the soccer World Cup, which Brazil will host in 2014, was lagging. The press was still feasting on the carcass of corruption scandals and a cabinet flap that had cost her five ministers in less than nine months. And yet Rousseff, in a fuchsia jacket, black slacks, and oversize pearl drop earrings, looked unflustered as she spoke about Brazil, the world economy, poverty, and corruption. Her hair was thick and lustrous, her cheeks flush, with no trace of the grinding sessions of chemotherapy she underwent to treat a lymphoma she discovered in 2009. For nearly an hour she held forth, firing off data points and toggling easily from job creation ('We’ve generated 1,593,527 in the first six months') to T. S. Eliot (“Ash Wednesday” is a favorite) to how women can rewrite the rules of political engagement. 'When I was little I wanted to be a ballerina or a firefighter, full stop,' she said. 'I don’t know if it’s a new world, but the world is changing.'"

While Dilma owes part of her success to Brazil's success, she has garnered accolades of her own accord. Forbes named her the third most powerful woman in the world, and political analysts agree that she has proven herself much more than just Lula's "bench warmer" (it's possible she may even run for a second term). Unlike Lula, Dilma tends to avoid the press when possible, so this week will be interesting to see her bask in the spotlight as she is recognized for her accomplishments of less than a year in office.

Sergio Documentary

Though it came out last year, I can't recommend this documentary enough, which recently aired on the BBC and came to HBO Go this summer. Sergio is a fantastic film that follows the life of Brazilian superstar diplomat Sérgio Vieira De Mello and his untimely death in Iraq. Described as a mix between James Bond and Bobby Kennedy, Sergio was a Carioca who grew up in Europe and traveled the world after joining the UN at age 21. The film alternates between the terrible day of his death and telling the story of his life and career. Though there's just a bit about Brazil and Sérgio's family, a lot of the movie deals with Sérgio's Brazilian diplomatic style. He was a diplomat in the line of Lula's foreign policy, that of engaging any and all leaders in the name of peace, including dictators and accused human rights violators. But what is really fascinating to see is how Sérgio's charisma and powerful personality captivated and influenced people around the world, from Condoleezza Rice to members of the Khmer Rouge. On the other hand, it's maddening and horrific to witness the attack on the UN that ultimately claimed his life. All in all, it's a really amazing story about an amazing Brazilian.

 

 

The film was based on a 2008 book by Samantha Power, called Chasing The Flame. Watch her speak about the book and about Sérgio below.

 

The film is available on HBO Go, for sale here, and may be floating around Youtube if you dig.

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.

Q&A With TNW's Anna Heim

The tech scene in Brazil is one of the most exciting in the world, and one of the best and brightest new Brazil tech writers is Anna Heim, a French expat and polygot who covers Latin America for The Next Web. She writes about countries throughout the region with a focus on Brazil, and has written about everything from e-commerce and smartphones to Orkut and lanhouses, as well as following some of Brazil's fastest-growing startups. I caught up with her recently to find out more about her interest in Brazil and technology, and about life as a gringa in Rio.

So you're French and work at a Video On Demand site. You've also lived all over the world. What brought you to Brazil? And how did you become interested in web technology?

It's true I used to work at a video on demand website in London, but that was before I came back to Brazil for a few months in March this year (I left two weeks ago).  I'm saying 'coming back', because I've lived in São Paulo and Rio for 18 months in 2006-2007.

My initial connection with Brazil is through film: I'm a fan of Latin American cinema in general, and Brazilian movies in particular. I did an internship in Brazil after my Film & Business degree and ended up staying for one more year, working at Rio Film Festival first, and then at an indie film distribution company, where I was selling Brazilian short and feature films to foreign distributors and broadcasters.
As for my connection with web/tech, it was mostly a hobby until recently; I spend a lot of time online (especially on Twitter) and I love to follow breaking news and trends. This is how I connected with Blue Bus, which is a Brazilian niche media (it's read mostly by advertisers and creatives). I wrote for Blue Bus from March to June, and started writing for The Next Web in May about the Latin American web/tech scenes, with a particular focus on startups. (I was already somewhat familiar with the startup culture as the company I was working for in London was one.)

What do you like most about living in Rio?

Unfortunately I'm not there at the moment, although I've lived there for one year and a half in total. As I'm sure you know, living there is like living in a postcard. It may sound like a cliché but the scenery is one of the things I enjoy the most: walking along the beach, seeing the morros in the background... I'm writing this and already feeling 'saudade'! I also enjoy the Carioca culture and how relaxed, friendly and informal it is. Although I like my gym, the city isn't as superficial as some think. I have a few close friends, the cultural life is quite vibrant, there are many French and foreign films at the local theaters, and from a tech/startup perspective there are some very interesting companies in Rio.

You really are quite the polygot (since you speak French, English, Spanish and Portuguese). How did you become fluent in Portuguese?

Thanks! I studied Portugal's Portuguese in Paris at Instituto Camoes for a few months but I only started speaking when I arrived in Brazil. Being fluent in Spanish helped me a lot (but my Spanish isn't that good anymore...)

You write for TNW, a tech site, about a number of topics but also about Brazil and Latin America. How long have you written for them (looks like maybe just a few months?) and why do you enjoy it?

I've been writing for The Next Web since May and I'm enjoying it very much. Besides the fact that I love to write about stuff I'm interested in, I also get a chance to connect with movers and shakers in the LatAm tech space. I'm very grateful for all the help I've received in connecting with the right people for my articles. I've found the local startup communities to be very supportive and it's a great opportunity to let people know about what's going on in the region, which is getting a lot of momentum.

You also write a blog on Le Monde about Brazil, in French. What topics are most important to you to convey to a French audience?

I do have a personal blog on Le Monde, where I write from time to time about culture, film, media, life in Rio, the connections between France and Brazil and the image of Brazil abroad. To be honest, I mostly write about what I am interested in and I don't really think about my audience :)

What do you think is the biggest misconception that foreigners have about technology or internet in Brazil?

I'm not sure there are any misconceptions, but probably a lack of knowledge of the local ecosystem and its specificities. Foreigners still have a limited knowledge of all that's going on, although investors and foreign companies are showing a growing interest in Brazil. I hope that my articles will help spreading the info about the local tech/web scene.
 
What do you think is one of the most interesting internet or tech trend in Brazil, and why?

Social interaction is very important in Brazil, and social media has been very successful in the country. Along the same line, I think crowdsourcing (the power of the crowds) could do very well. It could have a big impact on many areas, from film to design and politics, and even change the way we work. I've written a post about it a couple weeks ago, called Beyond the Buzzword: How Crowdsourcing Can Disrupt Brazil.

To read all of Anna's work on TNW, click here.

Indignation

Political corruption has plagued Brazil for much of its history, despite a successful transition to democracy. Politicians accused of corruption rarely face consequences, be it fines, jail time, or returning embezzled funds to government coffers. In fact, disgraced officials accused of corruption are often re-elected or return to working for the government, even some of the most notorious offenders. As a result, the Ficha Limpa bill received widespread support and was subsequently passed into law, which aims to prevent politicians accused of corruption from being allowed to run for public office. Unfortunately, like some other Brazilian laws, it hasn't quite "stuck" yet - the Supreme Court ruled in March that it would only go into effect in 2012, and that it would not be applicable to the 2010 elections, but only issued the ruling after the fact. Though this allowed a number of officials accused of corruption to take office, a number of elected senators are still awaiting decisions from the courts in order to take office, including Senator Cássio Cunha Lima and Senator Jader Barbalho. Last week, federal congresswoman Jaqueline Roriz, who was actually caught red-handed in a massive Brasília corruption scandal in 2009, was absolved by the House of Representatives, but will now have to face trial in the Supreme Court. But the Congress's decision to absolve her angered many Brazilians, setting off a new effort by citizens to combat corruption after many years of what some interpret as generalized indifference.

Perhaps part of the new impetus to fight corruption was a trickle-down effect. President Dilma has taken on corruption as a cornerstone of her administration, sacking her chief of staff and several ministers accused of corruption in the first year of taking office. Also, 30 members of the Ministry of Tourism were arrested recently after a Federal Police investigation that showed the ministry was embezzling government funds. This blunt, no-tolerance approach is quite different from her predecessor, who walked on eggshells to accomodate everyone and to maintain coalitions. Dilma has alienated many officials in her sweep, and some political parties have left her coalition. As The Economist explained in "Dilma tries to drain the swamp":

"In all this Ms Rousseff is slowly putting her own stamp on a government that she inherited from her predecessor and political mentor, Luiz Inácio Lula da Silva. But the multiple scandals are straining her ramshackle coalition. This consists of over a dozen parties, ranging from communist to right-wing populist, that between them give her the nominal support of around three-quarters of Congress. The main interest of some of the coalition’s smaller members is not ideology but the extraction of jobs and money—for personal gain or party financing—from government. They are annoyed that Ms Rousseff has tried to rewrite the rules of the game."

In addition, some political observers note that if Dilma is unsuccessful in maintaining amicable relations with Congress, she could potentially lose a shot at reelection in 2014. In fact, Reuters reported that she has not yet decided if she will even run again, or if she will allow Lula to return to run for a third term. [Update 9/6: Today, Lula announced that he will not run in 2014, though time will tell if he ultimately makes that decision]

Despite making some old-timers uncomfortable, others are eager to see Dilma take on corruption. She was lauded in a Financial Times op-ed last week, which also mentioned that an estimated 2 percent of Brazil's GDP is lost to corruption each year, between R$50 and R$84 billion. Also last week, a Brazilian senator proposed a bill that would create a National Corruption Day, in protest of Roriz's recent exoneration. In addition, Estadão recently reported that infamous São Paulo politician Paulo Maluf, who is wanted in the U.S. for funneling kickbacks through New York banks, could potentially return US$13 million to São Paulo state coffers if he makes a deal with the New York prosecutor. But $13 million is just a drop in the bucket - he and his family are estimated to have over US$100 million in offshore accounts.

So with all of these infuriating cases and impunity, why don't Brazilians protest? Spanish journalist Juan Arias asked that very question in a controversial op-ed piece in July, setting off a nationwide reaction. Political blogger Greg Michener offers a number of reasonable answers for why Brazilians have not traditionally protested corruption, including Brasília's geographic distance from major cities, Globo's all-reaching influence, and the culture of consensus. [Update 9/6: Greg has a great post about the new anti-corruption movement today - read it here] But Arias' piece really touched a nerve. Some were angry with him for criticizing Brazil, a natural reaction when an outsider makes a negative public statement about Brazil. But others were invigorated, and began organizing.

Here, a relatively new phenomenon came into play that could help explain why Brazilians haven't organized en masse specifically against corruption in the past. Using technology and social media, Brazilians discussed Jaqueline Roriz, Arias' "accusations," and the urge to do something more. Soon, thousands of Brazilians across the country had signed on to attend protests on September 7th, Brazilian Independence Day, in what they're calling "The Day of Indignation." Protests against corruption will take place in major cities and in many Brazilian states, though some organizers are using the Roriz case as the major focus of the marches. Facebook is the main social network being used to organize protesters, using public invitations to rally potential participants and to quickly disseminate information. (This is especially interesting given that Facebook has supposedly surpassed Orkut in number of users in Brazil, and because Facebook's invitation mechanism is much better than Orkut's) I originally found out about one of the marches from Facebook, after seeing that a friend in Rio, a young professional who recently gave birth to twins, is planning on attending the march with her husband.

Seeing this kind of indignant reaction is very exciting, even if some of it seems to be a reaction to Roriz's exoneration in Congress and not some of the other big corruption cases. While Ficha Limpa was an important accomplishment and a big step in the right direction, hopefully the next step will be to attack impunity, not just in terms of political corruption but across the board. One salient, recent example: the Rio de Janeiro public prosecutor closed 96 percent of the state's homicide cases this year, simply to meet a national goal to "conclude" all open murder cases since 2007 - even though the national goal was set in an attempt to combat impunity. The same trend is happening with state prosecutors throughout the country. If thousands of killers can literally get away with murder, what can you expect of some of the country's most powerful politicians?