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How Brazil could finally put an end to widespread cable piracy

1st April 2012 by Anna Heim

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Less than two days ago, the Brazilian police burst into yet another illegal cable TV operation, the news website G1 reports. This is almost a daily occurrence in Brazil, a country where cable TV theft is endemic, Txchnologist notes.

As part of its special series about Brazil, the GE-sponsored online magazine has decided to take a closer look at this issue and the police’s recent attempts to break it down.

Funnily enough, this phenomenon is known as GatoNet, which literally translates as “CatNet” – a slang reference to illegal wiring, as the term “gato” also applies to electricity, gas and water theft.

However, don’t think of it as amateur work done on a small scale; more often than not, it is actually run as a commercial operation by local gangs, the Brazilian tech journalist Nelson Vasconcelos points out:

spacer “Early in March, in the small city of Italva, police arrested a gang that was clearing about USD $55,000 per month on pirated cable TV. The next day, 16 people were arrested for running an illegal cable TV operation with three thousand subscribers in Baixada Fluminense.”

Some distance to go

In total, the Brazilian Association of Paid TV (ABTA) estimates that between 700,000 and one million people benefit from illegal access to cable TV. As you can imagine, the cable industry isn’t exactly pleased about it, claiming it represents losses of US$100m a month for legitimate carriers.

Still, there are some signs that GatoNet may finally be losing some ground. On one hand, cable companies fight the problem through encryption. On the other hand, the police have recently started to try to uncover illegal wiring, while using technology to localize antennas.

However, it is far too early for TV operators to call victory; illegal cable converters are affordable and fairly easy to install, sometimes with the help of the operators’ own technicians, Txchnologist writes. As a matter of fact, it is difficult to curb this practice in a country that ranks 73rd on Transparency International’s latest global corruption ranking.

An access issue?

While GatoNet isn’t limited to the slums, the fact that these are often controlled by criminal gangs makes the problem even more intractable. Until recently, the official operators were simply absent from these areas, creating a natural market for illegal TV services.

spacer Affordability is also an issue, with illegal packages priced from US$8 a month, less than half the regular subscription fee (which can be much higher for packages that include sports and other popular channels.)

These costs are one of the key reasons why legal cable hasn’t yet taken off. According to Brazil’s national telecom agency Anatel, pay TV currently reaches 13m Brazilian homes and 44m people. Despite their recent growth, these figures are quite low for a total population of 195m – and proportionally much lower than in Argentina.

Democratizing broadband

Several elements could soon contribute to tackle this bleak reality. Over the last few years, millions of Brazilians have left poverty to join the middle class, forming a consumer group that Brazilian companies are increasingly trying to target.

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The same goes for cable TV operators, which have started to show signs that they may consider adapting their offers to this new demand. In Rio de Janeiro, operators have partnered with the local authorities to provide lower-priced packages in recently pacified slum communities.

When we say ‘cable services’, we are talking about TV, but also of broadband Internet access. Local public initiatives have proven its potential for social inclusion, and there’s more to come.

As we reported, the Brazilian authorities are currently deploying an ambitious national broadband plan (PNBL), ahead of the 2014 FIFA World Cup.

Could its ambition to bring fast and affordable Internet access to millions of Brazilians and tourists could well be the best answer to GatoNet? We believe that the answer is yes.

 
Sources: Image Credit, Image 2,
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About the Author

Anna Heim is a polyglot French news junkie with a love for anything digital. A Sciences Po Paris alumnus and a Brazil lover, she has also worked in Canada, Spain and the UK in the Film & TV Business. You can follow her on Twitter.

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anonymous 303 pts

It's hard to feel sorry for cable companies. [2]

Actually, not saying financing crime is good or better than our conditions, it should be avoided at all cost, but they deserved it. I am from Rio de Janeiro, and despite being from an intellectually elite, socioeconomically worker class family (yes, in Brazil, studying in a good, hard University and doing well, better than the children of the economical elite, is no guarantee of being decently paid, or even of a stable job), Cartoon Network was often the joy of my childhood in a violent urban place when I had access to it. I am doing conscription this year, but the first time where it is mandatory for me to vote will be 2014, when I will be 19.

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10 years ago, the monthly price of cable TV was more than double of the minimal wage (about 350-600 reais, relatively cheap nowadays but a REALLY BIG LOT of money at the time), so that people living in a Brazilian favela in the more compact inner cities wouldn't never afford it. But there's no one of the middle class in the inner cities of Rio de Janeiro (Center, South Zone and the Atlantic seashore of the West Zone i.e. Barra) and São Paulo (Center, and the parts of the North and West Zones closer to it), only the rich and the machine's excluded.

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We from the middle class live in the closer suburbs (North and Southwest Zones of Rio, Niterói city), and some islands of wealth in the violent and poor distant suburbs where I never ever saw foreign tourists because where I live is the crap part of my city, full of dengue, bad sanitation, only rotten vegetables and fruits in the markets, no decent restaurants, clubs or bars, no decent streets, public transit, hospitals or public schools, and ugly fundamentalist Christian people (Northwest Zone of Rio, other cities in metropolitan area, 15+Rio+Nit, such as the here mentioned Baixada Fluminense, including 7-9 of them; incredibly it, just 50 km from the Center of Rio, was way worse before Lula), and there was ABSOLUTELY NONE affordable (cheaper than 450 reais) cable here before 2012. Do you know how much is our minimal wage now? About 520. And its quality is BTW horrible. The only good system is still satellite Sky (that bought DirecTV Brasil few months ago, not more than 3 and a half years).

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Where in the world there is an excuse for these astronomical prices in a city where 1/3 of the population lived below the poverty line, and in a metro city where 3/5 were as well, just 12 years ago? How the hell these GatoNets get so much profit if it's 1/10 of their prices, 50 reais in Rio and Niterói, and 30 reais in Baixada Fluminense? Corporations are really not the ones to trust. And people don't guess why we voted for a Marxist ex-labor union leader and an ex-guerrilla leader. How in this atmosphere of social apartheid and consequences of neoliberalism and globalism, the fully alienated fundamentalist poors, stupid right-winger American-way-of-life middle classes and reactionary burgeoisie think we are retarded for voting for them? As an anarchist I obviously didn't like our governments of both factions, but things only get worse when we elect incredibly corrupt conservatives and Christian democrats. Such as those damn bastards, Eduardo Paes e Sérgio Cabral.

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As Rusell said, they do it only in slum communities. Those benefitted are still only the ones living in the inner city, as its access in the metropolitan region is still absent except for luxury Sky and illegal GatoNet (popular at its most here, why would it be?). That's probably because of hidden interests, our middle class is not thaaaat well so we shouldn't be ignored. Although this index was made to claim that the government is doing well their job (our rich start in at least 9000 reais per month, a little more than 17 minimal wages, in my opinion), according to them those of the middle class or income are gaining between 500 and 1000 monthly reais. So it is still unfair to the largest part of the population.

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GatoNet was kind of a lesson to them. If companies are tricksters, Brazilians and their "culture" of taking opportunities out of others, in some cases even if it's completely against law, moral and ethics, can be even better ones. The losses should be much greater.

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Anna Heim 35 pts moderator

 anonymous Very insightful comment! I don't agree 100% with some things you said though, for instance there are still working-class people and middle-class elderly in Rio's Zona Sul (for ex. in Copacabana) - but I wonder how long they will be able to afford it...

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Russell Ziskey 18 pts

It's hard to feel sorry for cable companies.

 

And instead of doing what a business should do to become competitive, they decide to only offer lower-priced packages in "slum communities."  What a crock.

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