Industrial Internet of Things in Brazil

The usage of IoT technologies by Brazilian industries should increase over the next few years. In this article we will look at the status of M2M in Brazil, the regulation for this sector and notable companies operating in the country.

IoT Sector In Brazil and Industry Uses

The Internet of Things technology sector in Brazil has shown continuous growth in recent years, according to recent research. A study from 2013 by Qualcomm regarding the global markets of M2M technologies found that Brazil had the third largest base for this type of equipment in the world, with more connections than countries like Japan and the United Kingdom.

Qualcomm’s research, however, shows that these devices were found to be mostly car tracking technologies with 35% of connections and point-of-sale payment capture machines with 50% of connections. That year, M2M devices for industrial usage were measured at 250 thousand, or only 3% of the total number of these connections in the country.

The slow adoption of industrial IoT technologies in Brazilian industries can be related to the high costs for maintaining their connections, considering that, until recent developments, M2M connections in the country were charged the same heavy taxation as mobile device subscriptions. As a first step to address this issue and promote the expansion of these technologies in Brazil, the Federal Government instituted in 2014 a less burdening taxation policy for certain types of M2M connections. These refer to devices that do not require human interaction to function, which does not cover, for example, the prevalent point of sale machine connections.

The main industrial usage of M2M technologies in the country are related to telemetry and automation, used, for example, to control machinery, monitor energy consumption and provide information on inputs and stocks. More advanced data heavy usage of these technologies are currently limited to the types of connections offered by the country’s mobile operators.

Currently, the majority of Brazilian carriers offer M2M connection plans that make use of GPRS and EDGE connections. This is the case for market leaders Claro and Vivo, that represent close to 75% of the M2M connections in Brazil. Carrier TIM was the first to offer LTE M2M connections in August 2014 and operates over 144.000 industrial and automotive IoT terminals in the country.

Limitations to the expansion of Industrial IoT in Brazil

A relevant aspect to the slow adoption of industrial IoT in Brazil is the small amount of professionals focused on the programming and operation of this equipment. This specialized workforce is mostly found in other segments of technology industries, a limiting factor to the development and implementation of IoT solutions in the country.

Additionally, many Brazilian industries make use of legacy equipment unable to connect to IP networks, which severely limits the adoption of IoT solutions. The country’s networks on the other hand, in general do not provide the low latency required for the efficient operation of these devices.

Taxation Policies for IoT Connections in Brazil

IoT connections have been subject to reduced taxation since the introduction of a special policy in 2014. This policy institutes the relief of the Fistel tax for SIM cards used for M2M connections and the reduction of the following taxes:

• TFI, which is charged at the start of the SIM card activation process, from BRL 26.83 to BRL 5.68 per card
• TFF, which is charged annually for mobile connections, from BRL 8.94 to BRL 1.89 per card

It is important to note that this policy is only applicable to “devices that make use of telecommunication networks to transmit data to remote applications as means to monitor, measure and control the device itself, the close environment or data systems connected to it through its networks, without human intervention”, which is directed mostly to industrial uses of M2M devices.

Connections under this regime, called M2M Especial, started being measured by Anatel in August 2014 and as of December 2014 account for 1.2 million mobile accesses in the country or, 0.46% of the total mobile connections in Brazil.

Notable Companies in the Industrial IoT Sector in Brazil

Some of the most notable providers of industrial IoT equipment and services in Brazil include:

• WylessTM Data: Brazilian M2M solutions provider TM Data was bought by multinational Wyless in 2013, and currently offers services for small to large enterprises that include telemetry, tracking, finances, logistics and also offer a proprietary ERP integrated with M2M equipment designed for management solutions
• Gemalto: Dutch technology provider Gemalto, which acquired M2M equipment developer Cinterion in 2010, is focused on expanding on the Latin America industrial M2M market and currently offers solutions for smart metering, tracking, payment, industrial computing and remote management
• Sensorweb: Brazilian startup from the state of Santa Catarina specializes in temperature telemetry provides solutions for various types of enterprises based on IoT communications and remote management
• T-Systems: Multinational subsidiary of Deutsche Telekom established a research unit in Brazil in 2013 to develop industrial M2M solutions, which include management and logistics platforms that also make use of RFID technology