Generally speaking any market with strong competition, lower prices and a high churn rate would scare off potential new players such as MVNOs.
It’s a common intuition between agile technology companies that testing the Brazilian market by selling from abroad is a good way to test out the market in Brazil. Even Apple had this approach to the Brazilian market for many years. FOB sales might be a good way to TEST the market but it’s under no circumstances a feasible market entry strategy.
The reported year over year net growth from 2011 to 2012 was 19.4 Million mobile subscriptions. However the gross number of new subscriptions for the same period was 138.6 million subscriptions. We can conclude that 119.2 million mobile subscriptions were discontinued in the same time period, totaling 328 500 subscriptions per day.
Looking at the bigger picture, purchasing of an iPhone is a relatively small part of the total cost of ownership in the USA, where the monthly service charge from the mobile operator is the most costly part of the ownership. In Brazil it’s the other way around, purchasing of the device is the major expense, while the service charge from the mobile operators can be relatively low.
I’m willing to claim that Buscapé is the most successful online business ever founded in Brazil, with a small catch. Buscapé has for most of its 14 years been owned by foreign interests, first by American Great Partners Hill and later by South Africa-based Naspers. The day that Naspers bought Buscapé in 2009 was celebrated by the Brazilian online community as a new era for online business in Brazil.
Brazil’s international reputation for piracy is blown way out of proposition. The annual Global Piracy Study from USA based Business Software Alliance indicates that Brazil have the lowest Piracy rate of all countries in Latin America. More important than being the country with the lowest levels of piracy in Latin America, is the positive trend that the figures show. Piracy rate was reduced from 59% in 2007 to 53% in 2011.