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I sometimes get complaints that the blog is negative and too critical. That’s rubbish, I criticise when there’s a reason to criticise.
However, I do like to think I give credit where it is due.
And Anatel, the regulatory agency for Brazil’s telecommunications industry, deserves a pat on the back today for slapping a sales ban on three of the top four cell phone companies.
Anatel told Oi, Tim and Claro that they can’t sell new lines to clients until they improve their current service.
Anyone who lives in Brazil and has a cell phone will be overjoyed at the news. The cell phone companies here are a disgrace. They treat Brazilian customers like fools.
Think I am exaggerating? Well, look at the difference with which Telefonica treats its clients in Brazil and the UK.
In the UK, Telefonica owns O2. Last week, many O2 consumers were without cell phone service for 24 hours because of technical problems.
What did Telefonica do? It offered those affected the “equivalent of three days back for the disruption as a gesture of goodwill and to say sorry,” according to this story in Yahoo. That’s three days free service.
And if that weren’t enough, it will send every one of its UK customers a £10 O2 voucher to spend in one of its stores.
In Brazil, meanwhile, Telefonica comes sixth on the list of most complained about companies (at least in Sao Paulo, the country’s biggest market and the only one I can find details for). Three of the top 10 most hated firms are cell phone companies. See the 2011 list here.
And what has Telefonica done to provide solace or reparations to those millions of long-suffering Brazilians? Nada.
The Financial Times in this piece, suggests that the blame for the poor service in Brazil lies, at least in part, with Anatel itself. That might be true.
But the bottom line is that the telephone companies have been abusing Brazilian consumers for years, providing a truly terrible service at inflated prices.
Congratulations to Anatel for finally recognising that something should be done. I hope it’s the first of many similar acts.
Almost every day something happens to me in Brazil to remind me that I am rarely a valued client and nearly always just one more source of income for some money making enterprise.
It could be the phone company pestering me to take more services, nondescript bars charging $60 entrance fees, or the local supermarket, asking if I want a store card and offering next to nothing in return.
Last week it was American Express.
I never wanted an American Express card because I object to paying for a credit card in a nation where the average interest rate is 238 % per annum. But I was forced to get one when I moved here because Brazilian airlines wouldn’t accept foreign Visa or Mastercards and I needed some local plastic in order to book flights.
Last week, AmEx tripled the cost of my card. Just a year earlier it had gladly reduced it, acknowledging I paid my bills in full and on time. I wasn’t informed of the hike and they gave me no explanation when I called their 0800 number.
When it bought American Express for US$490 million in 2006, Bradesco boasted the brand enjoyed “considerable international prestige” and had in Brazil, “an excellent operational platform and a team of highly qualified professionals.”
It is hard to know if that was true and Bradesco’s clumsy management has soiled its reputation. (Although it is worth noting that Bradesco was third on the list of most complained about companies in Brazil in 2010, up from 29th in 2006.)
But whatever happened, there is a lesson here for Bradesco and American Express in particular and Brazilian companies in general.
Don’t punish your good clients and don’t treat them with disdain. The good loyal clients are the ones that will stay with you.
We’re only here for the beer.
That’s not something you’ll hear tourists saying about Brazil.
I don’t touch the stuff myself but connoisseurs (and lushes) tell me Brazilian beer is weak, fizzy and crap. Maybe that’s the reason so many people drink it on the beach in the morning.
But beer is one of the thorny issues that separate FIFA and the Brazilian government as they prepare for the 2014 World Cup.
Why, I hear you ask, would FIFA and Brazil be fighting over beer?It’s all explained here in my Financial Times blog.
Beer is no stranger to controversy in the World Cup. In 2010, South African police arrested 36 Dutch girls who wore orange dresses given to them by the Bavaria beer company and accused them of ambush marketing.
Another company had the rights to sell beer inside the stadium and they thought the girls were trying to get round that by drawing attention to themselves. (As if 36 stunning blondes in short dresses wouldn’t already be drawing attention to themselves.) The dresses didn’t even bear Bavaria’s logo.
But here’s a photo so you can see for yourselves (purely for journalistic reasons, of course)…
Brazil is one of the world leaders in recycling.
In plastic bottles, for example, only Japan recycles more than Brazil.
In aluminium, too, Brazil is out in front. Brazilians reuse 96.5 percent of all cans sold, a number far superior to Europe’s 62 percent or the United States’s 54 percent.
In solid plastics, Brazil is the fourth largest recycler in the world and in glass bottles it is fifth. In steel cans, it is third behind Belgium and Sweden.
Unfortunately, much of that recycling is not done by people picking through rubbish. It is not always carried out on an industrial scale and house to house collection is not common.
There are a few companies trying to change that. Coelce, the power company in Fortaleza, is one of them. There, more than 300,000 people hand over paper, glass, cooking oil and a host of other products in return for money off their electricity bill.
The model is such a success that Light, the Rio de Janeiro power utility, is aiming to reproduce it, starting in the city’s favelas, as I explain here in a recent Financial Times story.
Some 68 of Rio’s close to 1000 favelas have been pacified in recent years and Light’s project is part of that process that attempts to bring a certain normality to these areas. As I write in the story:
A pilot progam run by Rio’s electricity company Light started last week in the Santa Marta favela. Police entered the favela at the end of 2008 and expelled the armed drug traffickers who controlled the area. The 6,000 residents now live in relative peace under the command of community police officers.
“You don’t see drugs and guns any more but you do see lots of rubbish,” said Fernanda Mayrink, Light’s community outreach officer.
“This project encourages recycling within the company’s concession area and at the same time contributes to sustainable development and the consumer’s pocket. Light wins, the customer wins (and) the environment wins.”
Good luck to them. More such projects would result in more win-win situations.
There are a few great statistics knocking around that illustrate just how the strong real is enabling Brazilian footballers return from Europe and how that football is becoming better managed.
For example: In 2005, 804 Brazilian footballers left the country to sign for foreign clubs. In 2008 that number had risen to 1,176. It started to fall the year after and has been falling ever since. At the same time, the number of athletes coming home has risen every year since 2006, when 311 returned.
Here’s another: Corinthians are seriously offering around 40 million pounds to sign Carlos Tevez from Manchester City, one of the richest clubs in the world.
Just three or four years ago it would have been unthinkable that a Brazilian club could afford to sign a player at the height of his career like Tevez.
Of course, this could not happen with any top star. It is only possible because Tevez supposedly wants to be in South America, where he is closer to his family and where standards of professionalism are not as high as in Europe.
But it would be fantasy if Tevez wasn’t able to earn almost as much in Brazil as in England or Spain or Italy, thanks to the strength of the Brazilian real, which earlier this month reached its highest level against the dollar since 1999.
It is also because at long last serious administrators are replacing the corrupt dinosaurs who ran Brazilian league clubs as I point out in today’s Financial Times.
The new generation have put into place season ticket schemes that guarantee them income, struck new deals that in some cases have tripled their annual revenue from television, and signed significantly bigger sponsorship deals with companies that bank new signings.
Sponsors, for example, pay 75 % of what Ronaldinho Gaucho earns at Flamengo and 800,000 reais of Neymar’s 1 million-real-a-month deal with Santos.
“Of that 1 million, we pay 200,000 and the difference comes from image rights,” Alvaro de Souza, a former Citibank executive who now works for Santos, told me. “We get companies interested in using Neymar to sell their products and that goes towards paying his salary. He gets 70 percent of the contract and Santos gets 30 percent. The consumer market is bigger now and that means more brands looking for a piece of the market. Our shirt is very valuable because we have more exposure than before.”
Having said that, clubs like Santos and Flamengo are still a long way from earning the kind of money made by Manchester United or Barcelona.
Brazilian teams pay little attention to potential overseas income and are largely unknown in markets such as the US and Asia, even compared to neighbours Argentina. (Walk through the centre of any major city outside Latin America and there’s a decent chance you’ll spot someone in a Boca Juniors or River Plate jersey; there’s almost no danger of seeing a non-Brazilian wearing a Brazilian club shirt.)
The moment is also dependent on the continuing strength of the real, which many economists believe is overvalued (see this excellent Bloomberg piece). If it weakens, clubs will once again find it harder to match their European rivals.
Nevertheless, the structural changes taking place today are similar to the revolution in English football in the 1990s after Sky TV injected hundreds of millions into the game and stadiums were modernised following the Taylor report.
There is still a long way to go. But they are heading in the right direction.
I wrote this piece on the Financial Times blog yesterday about the strikes and unrest at two big Amazonian dam projects and how this reflects the shocking way Brazilian companies treat their workers.
And then today I saw this extremely timely story in the Valor newspaper.
According to the piece, Brazil is apparently the only one of 42 countries that is refusing to sign a contract that would commit its multinationals to formally avoiding degrading work practices in the Great Lakes region of Africa.
The area is rich in minerals and the deal would oblige big firms to treat workers there with a dignity they’ve not always been afforded.
It’s a disgrace that Brazil won’t sign.
There are few groups of people I have less respect for than Brazilian politicians.
This is a group that collectively awarded themselves a 61 percent pay increase just weeks before the government announced 50 billion reais in budget cuts.
It features such people as Romario, who skipped his first real test as deputy in order to fly back to Rio to play beach volleyball; Paulo Maluf, the former mayor of São Paulo whose name is a byword for corruption; and Tiririca, a TV clown who won more votes than any other candidate in spite – or because of – declaring he had no idea what lawmakers actually do.
This is a group of people so out of touch with reality that they elected João Paulo Cunha, one of the principal accused in the mensalão scandal, as head of chamber’s most important commission, the Comissão de Constituição, Justiça e Cidadania. (Note the word Justice…)
But if there is any group that deserves less respect than politicians it is Brazil’s political parties. Brazilian political parties stand for nothing except winning power and milking it for all it’s worth. Which was why my lead to this story in today’s FT begins,
“Gilberto Kassab, mayor of São Paulo, started a new political party this weekend. Ho hum. Yawn.”
Brazilian Politics. Who cares? They’re all the same.
When I read that headline, Small Earthquake in Brazil’s Planalto, in today’s Financial Times I thought people in the capital were worrying about books falling from shelves and coffee spilling over.
It turns out that the FT editorial was metaphorical rather than literal.
The paper lauded the earlywork of President Dilma Rousseff for making her own mark on government, paticularly in the fields of human rights and the economy.
Rousseff was Lula’s pic and many thought she might be Lula in a skirt. But the FT cheerily noted:
“Ms Rousseff has broken with her predecessor’s policies in a number of encouraging ways. One of the least appealing aspects of Mr Lula da Silva’s presidency was his cosying up to Iran, and his refusal to speak out about human rights abuses there. This posture made cordial relations with the US difficult. Ms Rousseff is reversing his stance. She rightly criticised the refusal of her predecessor’s government to join a UN resolution to condemn stoning in Iran.”
The FT also praised Rousseff for making more spending cuts but it warned these are early days and there is much to do, such as reform Brazil’s ridiculously complex tax code, boost the savings rate and prevent inflation and interest rates spiralling out of control.
The overall verdicton her first month was positive.
“Ms Rousseff has made a sound start,” the paper said. “The panic that greeted Mr Lula da Silva’s inauguration proved largely misplaced. If Ms Rousseff continues as she has started, she will confound the doubters as well.”
Amen to that.
Brazilian football players often return to Brazil at the end of their careers. They’ve made their fortunes and their reputations and they come back – often to their first clubs – and ease themselves into retirement.
Standards here are lower and they can get away with much more. Top names are given special privileges, such as permission to miss training, something that rarely happens at European clubs. (Although it is starting to happen more as player power grows.)
Just look at Ronaldo, who played only around half of Corinthians games last season because he was so overweight and uninterested.
Now, more and more big stars are coming home at an earlier age – Ronaldinho is just 30 – and some are even coming back in mid-career. Robinho played part of last year at Santos and Adriano took a sabbatical from Italy and turned out for Flamengo. That’s something quite new.
There are two main reasons for the change.
One is that Brazil’s currency is strong enough that stars’ spending power is barely diminished by earning in reais.
The second reason is that Brazil’s sports marketing has come on leaps and bounds and found new ways for sponsors to help clubs pay their top earners. Companies have cash because Brazil’s economy is booming and the middle class is growing fast.
A fuller explanation can be found in this piece I wrote for the Financial Times here today.
I finally got around to doing a press freedom’s story today that I’ve been meaning to do for a while.
The story can be found here on the Financial Times Beyond Brics blog and is about the Folha de S. Paulo’s lawsuit against two brothers who spoofed it on a web site called Falha de S. Paulo.
Falha means failure in Portuguese and the site attacked Folha for what it believes is the paper’s bias against the Workers’ Party.
I personally don’t think that the Folha is Tucano (that is, supports the opposition PSDB party). I think the paper is against more or less critical of everything and I love it for that.
Brazilian leftists, however, think that to criticise something is to be against something.
I’ve had more than a few frustrating moments in Brazil when locals have accused me of being a right-wing conservative because I’ve criticised Lula or his government.
They are unable to grasp the fact that I might be criticising, say, corruption or the lack of an education policy because I think corruption or the lack of an education policy is not a good thing.
The Falha web site wasn’t brilliant but in a free society people should be allowed to spoof and satirise within obvious limits of abuse.
More importantly, a newspaper like Folha – a paper that has built its considerable reputation on criticising the powers that be – should recognise that and respect it without recurring to censorship.
Under any terms.
ANDREW DOWNIE'S BRAZIL BLOG 