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Telecommunication services expensive in Brazil due to monopoly: study

06-08-2010 13:23 BJT

BRASILIA, June 7 (Xinhua) -- Monopoly in the telecommunications sector in Brazil has caused service to be offered at inappropriately high prices compared with people's income, an official study released on Monday showed.

According to the study, conducted by the Institute of Applied Economic Research (IPEA), infrastructure was improved with access to telecommunication services advanced during the privatization process of the industry in the 1990s.

However, the market has become controlled by a few economic groups, most of them counting on foreign capital, the study said.

Telefonica and Vivo of Spain and Portugal currently obtains 29 percent of the market share in Brazil's telecommunication industry, followed by Oi/Brasil Telecom of Brazil, with 27 percent, and Mexico's Claro/Embratel/Net, with 23 percent.

According to IPEA, a major obstacle for improving the quality of services is the lack of competition in the industry.

The convergence of technologies, goods and services which were previously separated, as well as the process of trade and regulation liberalization have led to major technological and institutional changes in the sector, the study said.

Meanwhile, the lack of control over the quality of services and the absence of policies articulated with other state actions, such as fiscal policies, have also barred telecommunications networks from further developing, it added.

Editor:Zheng Limin |Source: Xinhua

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