24
Annual Report -
2013
-
Vivendi
Group Profile |
Businesses
| Litigation | Risk Factors
1
GVT
2.3.
GVT
GVT is the leading alternative telecommunications operator for fixed
ultra high-speed broadband, fixed-line telecommunications and Pay-TV
in Brazil.
Two kinds of operators lead the Brazilian fixed telecommunications
services market: concessionaires formed by the privatization of Telebras
(the incumbent operator) that are subject to universal service obligations
and alternative operators that compete with such concessionaires in
defined regions. The provision of fixed-line local telephony in Brazil was
initially organized by Anatel (
Agência Nacional de Telecomunicações
,
the Brazilian telecommunications agency) into four regions: Region I
(North and Northeast, including Rio de Janeiro), Region II (Center and
Southeast, including the Federal District (
Distrito Federal
)), Region III
(São Paulo), and Region IV, which comprises national and international
long-distance operations.
In late 2000, GVT began operating as an alternative operator to the
local incumbent in Region II, initially servicing 24 cities. From 2006,
the Company has held licenses to operate all types of fixed-line
telecommunications services nationwide. At the end of December, 2013,
GVT operated in 150 Brazilian cities in 20 states as well as in Brasilia.
GVT is positioned as the leading alternative operator for fixed very high-
speed broadband, fixed-line telecommunications and Pay-TV in Brazil.
GVT pursues its growth strategy by expanding its network coverage
in cities in which it is already present and expanding its territorial
reach to additional key markets located outside Region II, aiming to
create a national presence across populated areas of Brazil. In 2013,
the Company launched operations in 14 cities across five states,
with almost 16 million inhabitants. It also began serving the retail
market of São Paulo, which is the largest city in Brazil. GVT’s strategy
for São Paulo is to focus on high quality services, pursuing growth
gradually, district by district, during 2014 and beyond. The company also
plans to launch services in other new cities in the South, Southeast and
Northeast of Brazil.
GVT is the fastest growing telecommunications service provider in Brazil
in terms of revenue and EBITDA. During 2006-2013, the Company’s
Compounded Annual Growth Rate (CAGR) was 30.2% for Revenue and
34.3% for EBITDA. In 2013, these indicators rise respectively by 13.1%
and 8.7% (at aconstant foreign exchange rate). In 2013, GVT held a
12.3% share (an increase of 0.9% in a year) of the broadband market;
a 9.15% share of the fixed-line market (an increase of 2.03% in a year),
according to the data of Teleco, an independent association that follows
the Brazilian telecom market; and a 3.8% share of the Pay-TV market (an
increase of 1.2% in a year), according to the data of Anatel.
GVT offers innovative bundles combining high quality and performance
at competitive prices for all market sectors (Retail, Small to Medium
Enterprises (“SME”) and Corporate). GVT delivers broadband speeds
to the retail market with differentiated value-added services and an
innovative integrated Pay-TV service. In the first quarter of 2013, GVT
improved its broadband portfolio by offering a speed of 25Mpbs as an
attractive option for consumers and by increasing the highest available
speed to 150 Mbps.
The new speeds are available with “Power Combo GVT”, a “triple-play
offer” of products offering customers broadband Internet, Pay-TV and
fixed-line telephony. This triple-play offer addresses people’s desire to
be constantly connected with quick access to Internet content on all of
their devices (e.g., personal computers, tablet computers, smartphones
and TVs). In 2013, triple-play bundles accounted for approximately 36%
of sales. By year-end 2013, Pay-TV achieved a 26% penetration rate
across the broadband customer base.
Delivering content, interactivity and managed services over broadband
Internet is part of the strategy to lead the broadband and Pay-TV
multiservice segment in Brazil. GVT is aware of the need to deliver ultra
high-speed Internet, enabling the customer to have a truly connected
home, with multiple devices operating over the same broadband
connection. In October 2013, GVT launched a new advertising campaign
“GVT broadband is as fast as the fastest countries”. The ads show that
GVT customers’ average base speed of 13.2 Mbps is similar to speeds
recorded in countries such as South Korea, Japan and the United States,
and is far above the Brazilian average of 2.4 Mbps, according to the
Akamai Institute for the period.
In 2013, GVT was recognized as the best telecommunications operator
in Brazil by Isto É Magazine, one of the most important Brazilian
business magazines, in a survey conducted by Trevisan Business School
with KPMG. The company’s broadband was voted the best in Brazil for
the fifth consecutive year in an open poll of readers of INFO Magazine,
the main Brazilian technology magazine.
GVT was voted for the second consecutive year the “Fixed-line
Telephony and fixed broadband Telecom Operator that treats its
customers with the greatest respect”, by an independent national
consumer survey (conducted by the Shopper Experience, a consulting
company, in partnership with “Consumidor Moderno” Magazine).
GVT’s social responsibility program “GVT for the Responsible Internet
Use” was awarded the 2013 prize for “Content with Social Interest”
by ARede, a respected national magazine that reports on digital social
inclusion. The program promotes the healthy use of Internet and new
technologies by children and young adults, through the use of online
and offline content produced in a collaborative way with NGOs and
educators.
2.3.1.
Strategy/Positioning
