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Viasat (VSAT) Partners SKY to Boost Satellite Internet in Brazil

Zacks.com logo Zacks.com 1/13/2021

Viasat, Inc. VSAT recently announced that it has inked a distribution contract with a subscription-based television service provider — SKY Brasil — to expand the presence of superior connectivity and satellite Internet across Brazil. The move is a strategic fit as service providers are striving to provide best-in-class broadband connectivity while addressing the burgeoning network requirements of customers, especially in the underserved areas of Brazil.

It is worth mentioning that the partnership will reinforce the long-standing relationship of both companies while boosting Viasat’s goal of providing more Brazilians with competitively-priced satellite Internet service plans. Moreover, it will propel SKY’s highly differentiated services on the back of its vast distribution network in Brazil.

Impressively, SKY is reckoned as the largest satellite pay-TV operator in the South American country. With more than 5 million customers, the company specializes in delivering a plethora of technological innovations combined with the best programming services in Brazil. The company’s majority stake is controlled by AT&T Inc.’s T direct broadcast satellite service subsidiary — DIRECTV Group. Markedly, SKY is known as the forerunner of first 4G broadband connectivity in Latin America.

As part of the agreement, SKY will be responsible for providing on-site technical assistance and selling Viasat’s reliable and superfast satellite Internet service across Brazil. With an unrivalled distribution network, the Brazilian operator has left no stone unturned to give a first-hand access of uninterrupted connectivity with avant-garde home services and home automation.

The recent development is expected to give a boost to Viasat’s distribution strategy while augmenting its fiber footprint across the South American country. Notably, the Carlsbad, CA-based communications company enables Brazilian customers to enjoy the perks of distance education, remote working and video streaming with high-quality Internet service.

Viasat has been investing in the South American country since 2018 and has set up a team with local expertise. In fact, Viasat’s residential Internet service for Brazil uses bandwidth from the Telebras SGDC-1 satellite. The service has been expanded to 14 additional states. This makes Viasat the only satellite Internet service provider capable of making high-speed Internet available across the country.

The company offers three competitively-priced plans — a basic plan (Viasat 10Mega), an advanced plan (Viasat 20Mega) and a premium plan (Viasat 30Mega). That said, the expanded partnership will support Viasat to make the best possible use of local resources with a steady Brazilian distribution partner and extend SKY’s reseller base, driven by Viasat’s leadership in the global market.

Currently, Viasat is eyeing opportunities to extend broadband satellite mobility to rotary wing aircraft, as it is a large addressable market that can emerge as a key profit churner. Solid traction of ViaSat-1 and ViaSat-2 satellites, along with strategically planned ViaSat 3 satellites, is expected to provide a solid competitive edge over its peers despite productivity challenges posed by the COVID-19 pandemic.

Viasat currently carries a Zacks Rank #3 (Hold). The stock has gained 3.2% compared with the industry’s growth of 15% in the past three months.

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Some better-ranked stocks in the industry are Comtech Telecommunications Corp. CMTL and Qualcomm Incorporated QCOM. While Comtech sports a Zacks Rank #1 (Strong Buy), Qualcomm carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Comtech delivered a trailing four-quarter positive earnings surprise of 2%, on average.

Qualcomm delivered a trailing four-quarter positive earnings surprise of 17.3%, on average.

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