Business

Brazil regulator approves 5G spectrum auction rules, no Huawei ban

Brazil's telecom companies insisted on a free market, complaining that excluding Huawei would cost billions of dollars to replace the equipment of the Chinese company that supplies 50% of the current 3G and 4G networks

Photo: REUTERS/Aly Song
  • Rules for the auction expected in June, however, have costly conditions such as requiring telecom companies to migrate by next year to more advanced technology with stand-alone networks not based on their current technology;
  • The rules must be approved by Brazil’s Federal Audit Court, the TCU, where the telecoms hope the government’s onerous conditions can be changed.

Brazil’s telecoms regulator Anatel approved rules on Thursday for a spectrum auction for 5G networks this year without any curbs on China’s Huawei as an equipment supplier.

Right-wing Brazilian President Jair Bolsonaro last year criticized the Chinese company and was under pressure from the former Trump administration to ban Huawei from the country’s fifth-generation technology market on security concerns.

READ ALSO: Brazil’s government may adopt a friendly tone about China’s Huawei 5G spectrum in exchange of vaccine’s ingredient

Brazil’s telecom companies insisted on a free market, complaining that excluding Huawei would cost billions of dollars to replace the equipment of the Chinese company that supplies 50% of the current 3G and 4G networks.

Rules for the auction expected in June, however, have costly conditions such as requiring telecom companies to migrate by next year to more advanced technology with stand-alone networks not based on their current technology.

They will also have to cover the vast northern Amazon region with broadband connectivity, largely using optic fiber cables laid in rivers, and build a separate secure network for the federal government.

READ ALSO: Bolsonaro will allow Huawei to take part in the 5G auction, says newspaper

Industry representatives said Huawei, the world’s biggest telecoms equipment maker, could not be excluded from Brazil’s 5G market because, besides the cost, it would set the country back three to four years in technology.

Two of Brazil’s main telecom companies, Telefonica Brasil SA and Claro, owned by Mexico‘s America Movil, are pressing for a 5-year transition to the more advanced stand-alone networks.

“The stand-alone condition requires changing the core of today’s networks and will set us back years,” said Vivien Suruagy, head of Feninfra, a lobby representing 137,000 companies that build and maintain telecommunications networks.

READ ALSO: Mega leak may have exposed data from 102 million mobile accounts on deep web

The rules must be approved by Brazil’s Federal Audit Court, the TCU, where the telecoms hope the government’s onerous conditions can be changed, Suruagy said.

EBANX LABS
Get the best insights about Latin America market in your inbox