Brasil Telecom

**Its history is the argument about the privatisation, in miniature.** The system was split in order to create competition, on the reasoning that several operators would serve customers better than one. What happened over the following decade is that the pieces began buying each other: Brasil Telecom was acquired by Oi, the group built on Telemar, another of the three fixed-line holdings, in a deal completed in 2009.

So two of the three parts the state had deliberately separated were back together inside eleven years, and the third - the São Paulo operator, Telesp - had become the Brazilian business of a Spanish multinational. **Nine hundred companies had become one, then twelve, and were now heading back toward a handful.**

**Whether that is a failure of the design or simply what telecommunications does is a fair question and this entry does not answer it.** Networks have strong economies of scale and interconnection costs that reward consolidation; regulators know this and try to hold the line against it. The pattern is not particular to Brazil, and any argument that it proves something about privatisation has to explain why the same consolidation happened in countries that privatised differently, and in some that did not privatise at all.

The company's later years were also marked by a long and public shareholder dispute, and the group that emerged from the merger has had a difficult financial history of its own. Readers should check the current position rather than take a state of affairs from a page like this one.