4G to help expand broadband internet access in Brazil

The use of the 700 megahertz (MHz) bandwidth is expected to bolster the expansion of Brazil's fourth-generation (4G) network in Brazil, said Communications Minister Paulo Bernardo on Tuesday (Sep 30). He maintains that the frequency range, which requires fewer antennae to be set up, will help telephone companies offer high-speed internet access to towns in the interior.

“We've increased the possibility of spreading 4G throughout Brazil. This service will be the big engine for universalizing high-speed internet. In the municipalities with fewer than 50 thousand inhabitants, a company will be able to operate an antenna connected to an optical-fiber line and sell its 4G signal. This requires fewer investments in physical structuring,” the minister explained.

According to the National Telecommunications Agency (Anatel), the 700 MHz band will make it possible to bring 4G technology and high-performance broadband internet access to rural areas, at a low operational cost, as this spectrum is ideally recommended for long-distance coverage.

At the 4G auction held Tuesday by Anatel, the first of the six mobile lots in the 700 MHz band was bagged by carrier Claro, following its $794.37-million bid. The second lot was won by TIM, at virtually the same price. The third lot was purchased by Vivo, at the minimum price. Algar Telecom, through a bid of $12 million, bought the fifth lot, which covers 87 municipalities in the states of Goiás, Minas Gerais, Mato Grosso do Sul and São Paulo.

Paulo Bernardo described the auction as a success, in spite of two lots (number four and six) left without a taker, and company Oi not having participated. “That not all lots would be sold was expected, but it's noteworthy that, at a moment of considerable turbulence in the financial market, four companies believed and invested in the county,” he declared.

In the minister's view, the fact that the government has decided not to require, in its tender offer, providing 4G services on roads and introducing a minimum transmission speed should not reduce the quality of the services. He explained that demanding antennae to be connected through optical-fiber networks will make a high-speed internet connection in the 700 MHz frequency possible. “This multiplies the capacity of cell sites to meet the demand,” he remarked.

The 700 MHz range has also the benefit of being used in most developed countries, which would make cell phones purchased abroad compatible with Brazilian 4G technology. The auction raised almost $4.1 billion. The government, however, will keep slightly more than half of this total. According to the Communications Minister, the National Treasury will be granted an auxiliary $2.22 billion at the end of the process.

With the concessions, the winning companies—Claro, Tim, Vivo and Algar—are to pay $2.41 billion, plus some $170 million to be able to operate 4G technology—in both 700 MHz and 2.5 GHz frequency ranges. The latter started being commercially explored in 2013.

Translated by Fabrício Ferreira