|UMTS Forum issues warning on Brazil’s 700MHz auction|
High licensing costs will drive up service for end-users, users says industry body
13 May 2014: The UMTS Forum has expressed its concern over the Brazilian government’s plans to maximise treasury revenues in its forthcoming 700MHz licensing process. The administration’s latest plans contrast with previous indications that Brazil would target a low-price license process in exchange for higher quality services and affordable mobile broadband pricing for end users.
“Spectrum licenses based on huge auction prices have historically proved to be disastrous”, warns UMTS Forum Chairman Jean-Pierre Bienaimé. “This was shown over a decade ago in several European countries, where high 3G auction prices dramatically reduced operators’ ability to invest in their networks. This in turn increased the price of services for end users, slowing the adoption of 3G.”
More recent examples include Australia and New Zealand, where high minimum reserve prices have resulted in part of the 700MHz spectrum remaining unsold.
“To benefit the Brazilian population, we urge the government to follow a low cost license model for the internationally harmonised 700MHz band. This will stimulate greater infrastructure investment, while opening up competition to several players – all resulting in higher quality services at affordable prices.”
“This strategy will reap positive long-term results for Brazil’s economic and social development”, continues Bienaimé. “Boosting production and technology development through local suppliers will also support governmental Industry Policy targets.”
The UMTS Forum has consistently supported the development of harmonised mobile communications in Brazil. The country’s historic decision in 2000 to align its frequency spectrum plan to ITU international harmonised bands has proved to be a landmark decision in the successful growth of mobile broadband. Brazil’s overall mobile penetration has jumped from 9% in 1999 to 46.8% in 2005 and 132.7% in 2012, with much of this growth fuelled directly by 3G (source: Teleco/ANATEL).
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Mobile broadband is changing the way the world communicates. The UMTS Forum helps all players in this dynamic value chain understand and profit from the opportunities of 3G/4G LTE networks and their evolutions.
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