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Tech Roundup: Will Covid-19 consolidate Brazil’s shift to e-government?

. Jul 31, 2020
e-government

You’re reading The Brazilian Reports weekly tech roundup, a digest of the most important news on technology and innovation in Brazil. This week’s topics: the bidding war for bankrupt telecom firm Oi, Brazil’s turn to e-government during the pandemic, and the country is a hotspot for ‘credential stuffing’ attacks.

Will Covid-19 consolidate Brazil’s shift to e-government?

Since the start of the pandemic, demand for government

services online has surged. In June, the federal administration&#8217;s online e-government portal Gov.BR recorded over 12 million users, three times that of January, according to data from the Economy Ministry. Does this mean Brazilians are beginning to wave goodbye to in-person bureaucratic services?&nbsp;</p> <p><strong>The great accelerator.</strong> The Economy Ministry <a href="https://congressoemfoco.uol.com.br/economia/pandemia-obriga-governo-a-acelerar-digitalizacao-de-servicos-diz-secretario/">said</a> the Covid-19 pandemic has forced the government to speed up its process to digitize services. As part of the 2020-2022 Digital Government Strategy, the administration intends to offer 100 percent of its 3,000-plus services online.</p> <p><strong>Right direction. </strong>As explained in last week&#8217;s <a href="https://brazilian.report/tech/2020/07/24/tech-roundup-brazilian-fintech-wants-save-amazon/">Tech Roundup</a>, Latin America — Brazil included — is improving in the United Nations&#8217; e-Government index. The index ranks countries according to their availability and quality of online services, telecoms infrastructure, and human capacity to operate it.</p> <p><strong>Keep an eye out. </strong>According to Alexandre Barbosa, a senior innovation researcher at ITS Rio, the success of this move to digital depends on how citizens will access the services. He mentions the Provisional Decree 983, regarding the use of electronic signatures in government agencies, as a crucial turning point. The decree is likely to go to a vote in Congress in the coming weeks. &#8220;It will be decisive to stop or further the digital agenda,&#8221; Mr. Barbosa tells <strong>The Brazilian Report</strong>.</p> <p><strong>States and cities. </strong>Though embedded in the ministry&#8217;s agenda, the digital transformation of states and cities has not kept up the pace with the advances seen in the federal sphere. States have been tackling their own agendas, with Mr. Barbosa praising the examples of Alagoas, Minas Gerais, Rio Grande do Sul, Ceará, and Espírito Santo.&nbsp;</p> <ul><li>But in order to make progress with municipalities&#8217; turn to e-government, the relationship between the Economy Ministry and the Regional Development and Science and Technology Ministries would have to improve, says the researcher.&nbsp;</li></ul> <hr class="wp-block-separator"/> <h2>Going bankrupt, telecom firm Oi now at center of bidding war&nbsp;</h2> <p>The troubled and near-bankrupt telecoms provider Oi, the fourth-largest in the Brazilian market, has all of a sudden found itself at the center of a fierce bidding war. Telecom infrastructure group Highline is battling to win the rights to absorb Oi&#8217;s mobile operations, competing against a consortium of the country&#8217;s three other sector giants, TIM, Vivo and Claro.</p> <p><strong>Why it matters.</strong> The top three companies fear the creation of a &#8220;fragmented market, with many different mobile providers operating across Brazil and competing with the big players,&#8221; said a local funds manager, who spoke with <strong>The Brazilian Report</strong>.</p> <p><strong>Yes, but … </strong>Sector experts are skeptical that a takeover by TIM, Vivo, and Claro would be approved by regulators. The deal would turn Brazil&#8217;s already concentrated market into an even less competitive landscape.</p> <ul><li>Oi&#8217;s near-bankrupt status, however, might offer &#8220;the necessary window of opportunity&#8221; for such a deal, according to the fund manager.</li></ul> <div class="flourish-embed flourish-chart" data-src="visualisation/3349816" data-url="https://flo.uri.sh/visualisation/3349816/embed"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <p><strong>Belle of the ball. </strong>In a securities filing, Oi <a href="https://www.reuters.com/article/us-oi-sa-m-a/brazils-oi-confirms-new-bid-for-mobile-assets-by-tim-telefonica-claro-idUSKCN24T29E">informed</a> markets that it had begun <a href="https://brazilian.report/newsletters/brazil-daily/2020/07/23/brazil-central-bank-optimism-recovery-telecom-amazon/">exclusive talks with Highline</a>, which it says is the highest bidder, without disclosing the amount. Then, the trio of Brazilian giants increased their offer to BRL 16.5 billion for a deal that would also include a long-term services provision contract.&nbsp;&nbsp;</p> <p><strong>Highline who? </strong>Highline is backed by U.S.-based investment firm Digital Colony, which according to <a href="https://www.bloomberg.com/news/articles/2020-07-23/colony-capital-makes-surprise-bid-for-2-9-billion-oi-division">Bloomberg</a>, is seeking to expand its footprint in Latin America. Originally focused on real estate, the company is now seeking to reposition its portfolio in telecoms infrastructure.&nbsp;</p> <ul><li>Besides buying Highline do Brasil, in 2019, the firm also purchased data center assets from Grupo Folha — which owns Brazil&#8217;s largest newspaper Folha de S. Paulo — earlier this year.</li></ul> <p><strong>Now what? </strong>Oi said it is analyzing further steps while respecting exclusive negotiations with Highline, which last until August 3. No further details were provided.</p> <hr class="wp-block-separator"/> <h2>Brazil among top 5 countries with most &#8216;credential stuffing&#8217; cyberattacks</h2> <p>Brazil is one of the top 5 countries in the world where the most &#8216;credential stuffing&#8217; cyberattacks against financial services originated in 2019. It leads Latin American nations in that category, according to a <a href="https://www.akamai.com/br/pt/multimedia/documents/state-of-the-internet/soti-security-financial-services-hostile-takeover-attempts-report-2020.pdf">report</a> by a content delivery network and security solutions firm Akamai</p> <p><strong>What is credential stuffing? </strong>As explained by <a href="https://www.wired.com/story/what-is-credential-stuffing/">Wired</a>, credential stuffing is a mass hacking technique by which attackers obtain a complete database of usernames and passwords —potentially resulting from corporate data breaches — and try to apply these login credentials into other digital services.</p> <ul><li>&#8220;Because people often reuse the same username and password across multiple sites, attackers can often use one piece of credential info to unlock multiple accounts,&#8221; explained Wired.&nbsp;</li></ul> <p><strong>Targets. </strong>Akamai found that around 20 percent of the 88 billion such attacks in the world were against media companies, including streaming platforms. Akamai attributed that to the surge in on-demand content in 2019. But press websites saw a 7,000-percent bump in attacks.</p> <p><strong>Update. </strong>A delay in the release of the report due to the pandemic allowed Akamai to include Q1 2020 data. In that period, Brazil climbed to the third position in the ranking, producing over 650 million attacks on the media industry and over 1.1 billion attacks in general.</p> <p><strong>How to protect yourself. </strong>Steve Ragan, who co-wrote the report, says that as long as logins and passwords exist, these attacks will continue. He argues that, besides educating consumers, companies should also implement more robust authentication methods.&nbsp;</p> <hr class="wp-block-separator"/> <h2>Take note</h2> <ul><li><strong>Fake news 1. </strong>Pro-Bolsonaro Twitter accounts were once again targeted by the Supreme Court. On Thursday,&nbsp; Justice Alexandre de Moraes ordered the suspension of 16 accounts on social media worldwide. The decision came after some of the accounts tried to circumvent a previous ruling which only blocked them for users located in Brazil.&nbsp;</li><li><strong>Fake news 2. </strong>Twitter complied with the ruling and blocked the accounts, but said it would appeal the decision. The company called the measure &#8220;disproportionate under Brazil&#8217;s current regime of freedom of expression.&#8221; On Tuesday, <a href="https://brazilian.report/power/2020/07/28/fake-news-crackdown-opens-dangerous-precedent-for-censorship/"><strong>The Brazilian Report</strong> showed</a> that Justice Moraes&#8217; decisions set dangerous precedents for the debate on freedom of speech in Brazil.</li><li><strong>Stocks. </strong>Tech companies are performing well on the São Paulo stock exchange,&nbsp; building on a trend which started before the pandemic. An index created by asset manager Brasil Capital demonstrated that tech companies gained 142 percent in market value in two years — against a general rate of 33 percent. In the first half of 2020, while the local stock exchange sank nearly 18 percent, tech companies alone soared 41.2 percent. &#8220;Troubled periods generally speed up technological innovations already underway in society,&#8221; reported <a href="https://6minutos.com.br/minhas-financas/empresas-de-tecnologia-batem-o-ibovespa-desde-antes-da-pandemia/">6 Minutos</a>.&nbsp;</li><li><strong>Cybersecurity. </strong>Hackers in Brasília wiped out over BRL 1.3 million in traffic tickets issued between May 2019 and January 2020. Authorities launched an <a href="https://www.convergenciadigital.com.br/cgi/cgilua.exe/sys/start.htm?UserActiveTemplate=site&amp;infoid=54365&amp;sid=18">investigation</a> on Wednesday.&nbsp;</li><li><strong>Data breach 1.</strong> Cosmetics giant Avon had its data exposed earlier this year, resulting in the leak of over 7 gigabytes found by <a href="https://www.safetydetectives.com/blog/avon-leak-report/">Safety Detectives</a>, a cybersecurity group. In a June 9 statement, the company — recently bought by Brazilian cosmetics giant Natura&nbsp;— confirmed there was an incident that affected its operations, but without offering confirmation that it was the same incident reported by Safety Detectives.</li><li><strong>Data breach 2. </strong>According to cybersecurity company Cyble Research Unit, a data breach at Brazilian online travel agency Hotel Urbano exposed the private information of over 20 million users (including passwords, addresses, IP numbers, and social media profiles). The data was leaked in March 2019, but the vulnerability was only discovered and confirmed on Monday. The company has yet to comment on the leak.</li><li><strong>Transportation. </strong>São José dos Campos, a city around 90 kilometers from São Paulo, is gambling on a shared public transportation app as a way to modernize its operations, reports <a href="https://olhardigital.com.br/noticia/-uber-do-transporte-publico-sera-implementado-em-cidade-paulista/104149">Olhar Digital</a>. Under the system, set to start in January 2021, commuters will use an app to hail a minibus, which will be shared with other commuters with similar routes. The idea is to recover the competitiveness of public transportation, which has lost out to ride-sharing services in the last few years. Additionally, the city wants to unify payments for public transportation in a digital account, which allows users to spend their credits as they wish.

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Laís Martins

Laís Martins is a Brazilian journalist pursuing a master's degree in Media and Globalization. Her coverage is focused on politics, human rights, and society. Previously, she worked for Reuters Brasil.

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