Privatization changed Brazil’s telecom sector forever — but not in the way it envisaged

In the past, having a phone line in Brazil was an investment. To get one, you had to endure a five-year waiting list and shell out at least USD 5,000. This was so far beyond the means of the majority of the population that phone lines were often left as an inheritance in wills. This changed with the privatization process of the country’s telecommunications companies, which occurred 25 years ago last week.

The part of state-owned company Telebras that dealt with landline telephony was broken up and sold to the private sector — a way to boost competition between companies and make telephone equipment more widespread. At the time, Telebras was responsible for controlling all telecommunications services in Brazil.

Telebras was a huge state-owned company that had been used for political featherbedding and faced a series of accusations of corruption. It still exists today, and manages the security of Brazil’s Geostationary Defense and Strategic Communications Satellite. The government of former President Jair Bolsonaro wanted to privatize the remaining part, but the firm was taken off the privatization chopping block by President Luiz Inácio Lula da Silva this year.

After these two and a half decades, the main result of the privatization has been the massification of access to telecommunications...