47% of Brazil's municipalities need more broadband to improve streaming services

Anatel has commissioned a report on the matter as it studies how to classify linear programming offered on the internet

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  • The new study does not affect on-demand platforms, such as Netflix and Prime Video, only linear programming over the web;
  • If the agency considers the model falls into the pay-TV category, it would have to follow stricter guidelines and be under a higher tax burden.

A new technical report issued by Brazil‘s National Telecommunications Agency (Anatel) points out that almost half of the Brazilian municipalities (47.2%) do not have fixed-broadband infrastructure capable of providing quality services for video streaming platforms.

According to the study, “2,631 municipalities are not yet equipped with the necessary infrastructure to allow minimum conditions for the enjoyment of audiovisual content through the Internet”. 

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The technical report considers 5 Megabits per second (Mbps) as the “minimum requirement” for video content offered by platforms in high definition (HD). Transmission with even higher quality (Ultra HD) would require the speed of 25 Mbps.

Valor Econômico says that Anatel commissioned the assessment as part of a broader consideration its board is now making: how to classify linear programming offered through the internet. The agency is debating whether this service falls under an over-the-top (OTT) category or it should be considered a pay-TV service, which follows more telecom and audiovisual guidelines and has a higher tax burden.

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The discussion does not affect streaming services such as Netflix, Amazon Prime Video and Globoplay, as they offer video on demand (VOD), not linear programming. But there are some new platforms and existing players adopting linear programming over the web as a business model. Viacom CBS’s Pluto TV, for example, which is scheduled to arrive in Brazil later this year, offers both on-demand shows and channels with linear programming.

In 2018, Claro, a telecom carrier, filed a complaint against Fox+ and Esporte Interativo+ apps, which offered their channels’ programming. Anatel suspended both services as a precautionary decision.

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Depending on Anatel’s decision, pay-TV operators could migrate to online services – albeit partially – in order to reduce costs and charges with the maintenance of the networks dedicated to the offer of channels, says Valor.

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