Brazilian operators to invest $6 billion in M2M

Brazil’s telecoms operators have reportedly announced plans to invest an additional BRL13 billion ($6 billion) in developing M2M technology over the next four years following moves by Brazilian authorities to cut the taxes they must pay on M2M SIMs.

Recent moves to reduce the charges operators have to pay on active M2M SIMs appear to have spurred operators to pour additional funding into their M2M activities, according to a report from Business News Americas.

Previously, Brazil’s communications ministry had said it expected the number of M2M terminals to rise from 17.5 million to 23.3 million following the tax reduction, although data from Anatel – Brazil’s telecoms regulator – indicates there are currently around eight million M2M terminals in the market, accounting for about 3% of the entire mobile market.

Meanwhile, according to Business News Americas, executives gathered at an M2M conference in Sao Paolo have predicted the number of M2M terminals will hit 10 million by the end of the year.

Authorities have insisted that tax reductions will have no impact on the 2014 fiscal budget – because the fees will not be collected by Anatel until March next year.

In 2015, however, the lowering of operation and installation inspection fees is expected to result in a loss of BRL110 million for the government, reports Business News Americas.

Authorities are also said to have laid out plans for the creation of a new agency that will manage the tax concessions and look to boost the development of M2M services in Brazil.

The agency would play a central role in coordinating the activities of various ministries – including development, industry and trade, transport, and science, technology and innovation – that have an interest in M2M.

The report suggests the agency will come into existence by the end of the year.
M2M players have been hungrily eyeing the Brazilian market due to the size of the potential opportunity in areas such as smart energy, fleet management and connected healthcare.

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