Growth Strategy
Organic growth - fiber and mobile
The Company is concentrating on the organic occupation of its fiber network.
In parallel with the growth in FTTH customers with the occupation of the network, the Company, as a regional 5G mobile operator, intends to cover the entire urban area of the Northeast and Midwest regions by 2029, serving all cities under 30,000 inhabitants and the major cities in these regions.
Historically, the Company's focus was on small and medium-sized towns in the interior of the Northeast, with up to 250,000 inhabitants. In these categories, the Company increased its customer base from 173,000 subscribers in 2018 to 600,000 in 2023, with a CAGR of 28.2% over the period. From 2019 onwards, the greater scale achieved by the Company, access to lines of financing and the security of a tried and tested model will allow the Company to focus on larger cities, starting with the capitals. In 2018, the company had 69,000 subscribers in large cities (including the metropolitan regions of the capitals) and increased this number to more than 690,000 by the end of 2023, with a CAGR of 58.6% over the period.
The Company's growth since 2018 has been greater than that of any other competitor in the areas in which it operates.
Accelerated growth of new products
In addition to selling high-speed internet products, the Company continues its journey of offering greater added value to its customers by providing new services/selling products in both the B2C (retail) markets, such as Brisa Fixo, Brisa Móvel and Streamings, and in the B2B (corporate) market, with corporate solutions, video monitoring and voice services such as 0800 and virtual PABX. In 2024, the company started offering the FWA (fixed wireless access) service, using 5G technology to bring fixed broadband to customers even where there is no FTTH network.
With this, the Company is following a natural move by ISPs to become a hub of solutions for customers, going far beyond Internet access.
The Company has several new products already mapped out or in the process of being implemented, with the aim of bringing new B2C and B2B solutions:
· B2B business growth: Opportunity to grow B2B business with high margins and without incremental CAPEX by leveraging the fiber backbone network already installed;
· Added services: (Up-Sell and Cross-Sell opportunities). Up-sell and Cross-sell of complementary services (e.g. streaming platforms). Expansion of corporate services complementary to internet supply the value proposition to customers by offering more products and greater speed and quality;
· Protected Family: This consists of filtering adult content from the Internet, and has a block list of more than 700,000 sites with inappropriate content for children; and
· Video monitoring: This is a service that provides public monitoring with intelligence and various analytics such as facial recognition, vehicle identification, people counting and many other features.
Increasing connectivity and scope of action with 5G
The Company was one of the ISPs to win the 5G radio frequency auction held by ANATEL in November 2021. The company was awarded the rights to use three radio frequencies for 20 years, renewable for a further 20 years: 50Mb of spectrum on the 2.3GHz frequency in the Northeast region, 80Mb of spectrum on the 3.5GHz frequency also in the Northeast region and 80 Mb of spectrum on the 3.5GHz frequency in the Midwest region of the country. These regional frequencies entail the obligation to bring the service to urban areas in municipalities with less than 30,000 inhabitants in these regions. In addition, R$168.4 million was committed to the concession, to be paid over 20 years - from December 2021 to December 2040. The premium offered at the time of the auction was transformed into future service commitments - in 1,148 locations in municipalities with less than 30,000 inhabitants and backbone/backhaul in 78 cities in this same condition in the Northeast, as well as three cities in the Midwest.
5G technology has the potential to boost data demand in the region and create a significant barrier for national telecommunications operators in the interior, but it will require additional bandwidth for providers, as well as a series of logistical and operational challenges, considering that the auction included a commitment to serve cities with fewer than 30,000 inhabitants with 5G and the obligation to develop the backbone structure in municipalities that do not yet have fiber optic transmission networks.
The fiber optic infrastructure already installed by the Company in small and large cities will be fundamental for data transport in 5G, as both technologies are complementary.