The telecommunications and digital TV sectors are both growing strongly in Brazil, mainly because they meet their people's need for communication and access to services.
Interview with Didier Dabin, export adviser at Ubifrance Brésil, on the sidelines of an international digital sector conference - Rencontres Internationales du Numérique - which took place in Paris on 20-21 October.
L'Atelier: What are the most dynamic segments of the high-tech sector in Brazil?
Didier Darbin: Without doubt portable devices and mobile technology. In Brazil there are 224 million mobile devices for 196 million people. More than 31 million people already have 3G-enabled equipment and the number of smartphones is growing exponentially. There are huge opportunities, especially given that from April 2012 onwards the first 4G licences are due to be allocated. People are very keen on the services they can obtain. Shopping online is very popular, for example, whether over the Internet or via mobile. You can buy anything, even medicines. The Onofre pharmacy group provides an iPhone and Android sales app. Digital TV is another burgeoning market and this means that remote services – for example financial services or shopping services – can be made available to homes that don’t have Internet or sophisticated phones. And there are still many that don’t.
L'Atelier: So this huge increase in digital TV stems from local habits and needs. Are there other high-tech sectors which have seen strong growth because they provide an answer to an existing problem?
Didier Darbin: Yes, in the field of computerisation and paperless operations. In fact, the government has focused efforts on these areas in order to fight corruption, reduce costs and increase competition. These days digital signatures are widely used by companies. Also nowadays all public sector tender procedures are carried out over the Internet, on the basis of reverse auctions. Before the Web, it was very difficult to manage a large number of bids properly. And the ‘Dutch Auction’ system they now use means they know the exact amount of the last bid recorded. And here again, private companies are also getting into this approach. They can, for example, find out the number of potential suppliers, set up competition between them, computerise procedures etc.
L'Atelier: So the sector seems to be stimulated each time by initial needs which then help to create new markets…
Didier Darbin: Yes, we’ve also seen it in the security sector, especially in the transport segment. Brazil is a very big country, and vehicle theft is very common. So the government has made it mandatory for vehicles to be fitted with anti-theft GPS/GPRS tracking systems. This has stimulated innovation, the creation of innovative services, and cooperation between carmakers, equipment manufacturers and suppliers. And the task wasn’t an easy one, as they had to develop an open solution that could be used right across the board.
L'Atelier: And what’s happening with the financing of innovations?
Research and development is still 70% State-led, particularly as regards primary research or long-term projects. However, the private sector is getting more and more involved. This is mainly due to the government policy of offering tax breaks to companies which invest in research on a two thirds-one third basis. That’s to say that two thirds of a company’s capital investment can be in its own projects and one third must go to a research institute. Company research projects tend to focus on the short term, looking to improve the company’s products and help it to grow the business.