4G Weekly Digest 6.18

4G Weekly Digest

January 27th, 2010 - Volume 5, Issue 18

The Year For WiMAX in Brazil?
By Cintia Garza, Market Analyst, CALA, & 4GCounts Team Leader

Demand for wireless broadband access is intensifying in Brazil, but the lack of sufficient spectrum has delayed many players’ plans to deploy commercial networks. 75% of the 3.5 GHz spectrum remains in the hands of government. The 2.5 GHz band is used by MMDS operators, who have been impeded from deploying mobile WiMAX networks to avoid competition with 3G players. 3G players need more spectrum to expand and upgrade their networks to newer technologies such as LTE, and hope that Brazilian regulator Anatel will release some 2.5 GHz spectrum for 4G. The 700 MHz band is currently being used for broadcasting services, and the 450 MHz spectrum has not been auctioned. Demand is high, but spectrum is a limited resource, according to Maravedis’ latest report, “Brazil Wireless Broadband and WiMAX Market Analysis, 2010.”

The timeframe for the upcoming 3.5 GHz auction depends on the closure of public consultation N°54, whose major objective is to update how the 3.5 GHz spectrum band is used. The objective is for the band to also be opened up for mobile applications, a major change for operator, since up until now only fixed services have been permitted.

The biggest WiMAX networks in Brazil are Neovia and Embratel, both with networks deployed in the 3.5 GHz band, but focused on fixed applications for corporate customers. Embratel has some 16e equipment installed, but is only using this for fixed access. WiMAX in Brazil is available only for corporate users at present. There are approximately 130,000 WiMAX subscribers in Brazil, using a combination of 16d and 16e equipment.

Neovia conducted 802.16e-2005 trials in 2008 and 2009, and hopes to launch a network using this technology. Mobile WiMAX operations have not been considered mainly because the regulator has not allowed it. Neovia is trying to position itself in the market with nomadic services, and is hoping to obtain a license that will permit it to do so in its allocated spectrum. Although the operator recognizes the market gap between nomadic and mobile services, it does not believe this to be substantial in Brazil. If allowed to provide nomadic services, Neovia will keep its current fixed WiMAX network to serve current and new customers. The new 802.16e-2005 operations will overlap with Neovia’s existing 802.16-2004 network. It plans to use all its current 802.16-2004 network capacity, rather than to replace one technology with another, and expects slow migration from fixed to nomadic services, depending on the territory and zone.

Neotec is the consortium of MMDS operators in Brazil, including: MMDSE, ITSA, ACOM, TVA (Telefonica), and Teleserve. MMDS operators are allowed provide data services using their 2.5 GHz spectrum with proprietary systems such as DOCSIS and NextNet. MMDS operators have conducted several WiMAX trials in Brazil with Samsung, Nortel and Motorola; however Anatel did not provide certification for the WiMAX equipment that operates in the 2.5 GHz band.

“Anatel is currently doing evaluations on a new allocation and usage of 2.5 GHz,” commented Maximiliano Salvadori, General Manager of Spectrum Engineering at Anatel. “The use of the spectrum under this new allocation will be technology neutral; meaning it could be used either for WiMAX, LTE or any technology available. Any operator will be able to participate in this auction and bid for the spectrum. We are planning to create a framework in which current MMDS operators can benefit from the new changes on the conditions of usage of the 2.5 GHz frequency band.”

“Fortunately due the Brazilian National Broadband Plan, there is some internal pressure in Anatel to push 3.5 GHz actuation (probably Q2 definitions and Q3 actuation…) and in the same way they are pushing the 2.5 GHz frequency allocation definition, hopefully during some time in Q1. We need this to continue the WiMAX business in Brazil,” commented a spokesperson for a recognized equipment vendor in the Brazilian market.

Based on in-deep interviews with the Brazilian regulator and operators, the “Brazil Wireless Broadband and WiMAX market Analysis”report analyses the present regulatory situation for WiMAX including the bands 2.5 GHz, 3.5 GHz and 10.5 MHz; and 3G, including the bands 850 MHz, 1.8 GHz and 1.9/2.1 GHz. It provides detailed profiles of WiMAX players, deployment status and their reaction to the recent public consultations N°31 and N°54. It also synthesizes the participation of mobile players and the spectrum that has been allocated to each of them. It finally provides Maravedis’ assessment on the future prospects for the Brazilian telecom market. The report includes opinions and contributions from interviews with Anatel, TVA Brazil (Telefonica), ACOM Group, Neovia, Neotec (MMDS Consortium), Vendors and Brazilian industry analysts.