According to Maravedis’ latest report, 2010 could be the year for the Brazilian 4G market, with auctions expected for the 3.5GHz, 2.5GHz, 450MHz bands and remaining 3G spectrum. Drawing from in-depth interviews with Brazilian operators and regulator Anatel, the report provides a detailed look at the broadband wireless market and regulatory activity.
“As the largest market in Latin America, Brazil offers attractive opportunities for 4G operators. Demand for wireless broadband access is intensifying, but lack of sufficient spectrum has delayed many commercial network deployments. With two public consultations held in 2009 for 2.5GHz and 3.5GHz spectrum allocation, Anatel could release spectrum for the development of 4G this year,” explained report author Cintia Garza, Senior Analyst for Latin America.
In Brazil, Embratel, has completed the first phase of the WiMAX rollout by covering the 12 state capitals with Fixed WiMAX. In Peru, EMAX S.A. is using Navini gear in the 2.5-2.7 GHz band. Additional licenses in the 2.5-2.7 GHz band are being auctioned in Peru.
WiMAX in Brazil is regulated by Anatel (National Agency of Telecommunication).
In Chile, Telmex (which also owns Embratel Brazil) has been operating a Fixed WiMAX network and recently upgraded to cover most of the country. A mobile WiMAX network being built by VTR (a cable TV and internet operator) is now nearing completion. 700 MHz spectrum is also planned to be auctioned in Chile by its telecom regulator, Subtel. In Bolivia, Entel is building a Mobile WiMAX network based on technology from Alcatel Lucent.
According to Telecoms.com, Brazil’s 3G operators are apparently fearful if the country’s MMDS operators start using their 2.5GHz spectrum assets, with mobile WiMAX equipment.
The cellular operators paid a total of $3.4bn for their 3G licenses in December 2007, and they argue it would be unfair if Mobile WiMAX were to get a foothold in Brazil, leaving little room for LTE.
On the other hand, mobile services have been a tremendous success, with 168 million mobile users out of a population of 192 million inhabitants. The predominant technology is GSM with 151 million subscribers, followed by CDMA and WCDMA with 8.4 million and 3.5 million respectively.
Brazil is a big market. It has a population over 190 million and is one of the strongest economies in Latin America, but still has fewer then ten million broadband connections.
Brazil is potentially one of the world’s most dynamic WiMAX markets, says Infonetics. WiMAX has an opportunity to become the primary broadband network in Brazil, where the number of WiMAX subscribers is forecast to skyrocket from 184,000 in 2008 to almost 8 million in 2013.
Key findings of the Maravedis report (pdf):
- 75% of 3.5GHz spectrum has yet to be released.
- There are over 130,000 WiMAX subscribers today in Brazil, using a combination of 16d and 16e equipment.
- Major WiMAX players in Brazil are Neovia and Embratel (Telmex) (3.5GHz only).
- WiMAX ARPU is US$30 (residential) and US$115 (business) compared to US$15 for 3G services.
- The 2.5 GHz band is primarily allocated to MMDS and BWA, with restrictions for mobility.
- Anatel might auction 2.5GHz under a technology-neutral scheme allowing mobility.
- Major 3G mobile operators in Brazil include: Vivo, TIM, Claro, Oi and Telecom Brazil
“At present WiMAX activity in Brazil has taken place in 3.5GHz only, with Neovia and Embratel leading the market, says Maravedis. The driven applications are high-speed Internet and VoIP provided, mainly to address the needs of the small-medium enterprises and multi-dwelling units markets,” she added.“
The 2.6 GHz band, which runs from 2.5GHz to 2.69GHz, was allocated worldwide for mobile communications in 2000, when it was expected that 3G services would expand there. The ITU’s leading game plan is to divide the 2.6GHz spectrum into two sections; one 140 MHz block devoted to FDD services (such as LTE) and a central 50 MHz block for TDD services (such as Mobile WiMAX).
In option one, four different LTE carriers could bid on the FDD spectrum in one region, in blocks of 10 MHz or 20 MHz. The middle portion of the band has 50MHz dedicated to TDD-based WiMAX. This approach has been the preferred option by many national telephone governing boards, because it encourages competition between LTE and WiMAX carriers. GSMA argues that approach will be inefficient if WiMAX is unpopular.
In the USA, Clearwire and Sprint have accumulated nearly all the 2.6 GHz spectrum. GSMA says that “at some point it may well become desirable to make better use of the 2.6GHz band in the United States than is represented by the current investments of Clearwire and Sprint Nextel”.
