Brazil raises $8.4 billion in 5G tender

BRASILIA:

Brazil raised $8.4 billion in investments and license fees in an international tender to build and operate one of the world’s biggest 5G data networks, Brazil Communications Minister Fabio Faria said on Friday.

The final result - 46.8 billion reais ($8.4 billion) - came in just shy of the $9 billion the government had forecast. Faria heralded it as a success.

The result “beat all expectations,” he told a news conference at the close of the two-day auction, which drew 15 bidders.

Winning bids went to companies including Telecom Italia’s local subsidiary, Tim; Spanish group Telefonica’s Brazilian unit; and Claro, owned by Mexican telecoms magnate Carlos Slim’s America Movil.

Six newcomers to the Brazilian market also made winning bids and will now become mobile providers, which should increase competition and benefit consumers.

Brazil, Latin America’s biggest economy, is looking to leverage so-called fifth-generation mobile technology to accelerate the development of its industrial and agribusiness sectors - as well as bring super-fast internet to the cell phones of its 213 million people.

The tender was for the right to build and operate different “blocks” of the frequency spectrum for 20 years.

Brazil also tendered the development of a separate network that will be reserved for government communications.

Bidding for the latter excluded all equipment from Chinese telecoms giant Huawei, the target of US espionage accusations that had put Brazil in a bind forcing it to navigate the tumultuous tech standoff between Beijing and Washington.

The world’s two biggest powers are also Brazil’s two largest trading partners, and the country came under pressure from both sides over the ground rules for its 5G network.

That led it to postpone the tender from early 2021 as initially scheduled.

President Jair Bolsonaro called the tender “historic” Thursday as he opened the bidding in Brasilia with a symbolic bang of the auctioneer’s hammer.

Brazil hopes 5G technology will open new horizons for its economy, ranging from connected tractors and crop-monitoring drones for the booming agricultural sector to self-driving cars and telemedicine to bridge the sprawling South American country’s infrastructure gaps.

“Consumers won’t see that much difference, aside from faster download times for movies and videos. But from the standpoint of industry, this is going to open up a whole new reality for factories, agribusiness, the productive sector,” said Marcos Ferrari of Conexis Brasil Digital, a group representing five of the bidding firms.

Published in The Express Tribune, November 6^th, 2021.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.