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| Pelorhino_ historial center in Salvador |
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| Favela in Salvador |
Brazil provides an interesting case study of the mobile phone industry. Like most other countries both in the global south and north, the Brazilian market is dominated by a handful of big players: Oie, Vivo, Claro and Tim. But when it comes to cost of data usage, Brazil almost has two markets: the affluent South and poor North. And the biggest difference between the two markets is cost. While Brazilians living in Sao Paulo or Rio pay almost $80 - $100 for data for the mobile, north Brazilians pay $20 or less in a month for mobile phone data. Why such a remarkable difference in the cost? Simple, people in the North are much poorer than those in the South, and cell phone operators have adopted different strategies for the two regions. The operators have inflated costs for data in Sao Paulo, Rio and other cities in South because they know people can afford to pay high prices. But in Salvador they offer cheap plans that provide unlimited data access for a day for about R$ .50 or 30 cents. The plans are pay as you go plans so people can access data if they want and not use it when they don't need it. Everyone I interviewed in Salvador was using these plans and most operators offered similar plans. Most people did not use data pans everyday, they used it only if they needed it.
When I was recently in Salvador (which is capital of the Northern state of Bahia) everyone I met took it upon themselves to educate me about the economic difference between South and North Brazil. Having visited Sao Paulo last year, I could clearly see the difference between the two places. As a visitor, you can see that Salvador and its population is much poorer compared to Sao Paulo. The roads are less nicer, the hotels although less expensive appear to be dated (my hotel seemed to be a set of a movie from the 1970s), restaurants don't look as upscale as what you would find in Sao Paulo or Rio, and you can't spot helicopter taxis in the sky that are a fixture in Sao Paulo used by the rich to beat the crazy traffic.
I will do another post about other interesting things that I saw/researched in Brazil.
