TIM reports profits up 30%, will bid in Brazil’s 4G auction

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TIM is participating in Brazilian LTE auction, TIM President Luca Luciani said in a conference call today. TIM reported a 30% rise in first-quarter profit, with its share of the country’s booming mobile market delivering solid revenue growth. Read the full report here.

The Brazilian government’s auction is expected to collect at least US $2.01 billion (R$ 3.8 billion) for the 450 MHz, 2.6 GHz band, if all allocations are sold.

On April 10, TIM released a statement warning of risks in what the telecom operator called “a premature initiative.” According to the statement, the bidding documents had some issues that could have affected competitiveness among potential participants. “Government has made adjustments and, after several discussions, we believe the situation has changed in a positive way,” said Luciani on today’s call.

TIM also unveiled plans to launch a fixed ultra-broadband. It will be a soft launch starting in May followed by a commercial launch in 3Q12. More than 1,000 buildings are connected and more than 3,000 are authorized for connections.

TIM reported its subscriber base reached 67.2 million users, which represents a 27.2% growth, year-over-year. TIM reached 9.9 million lines, including a strong net addition of 3.1 million new lines. Its first-quarter net income rose to US $146.3 million (276.4 million reais).

During the conference call, Luciani also noted that the switch from fixed to mobile communications is just beginning in Brazil. “I believe this transformation is the greater fact in 2012,” he said, adding that infrastructure integration is a key part of achieving future results.

Luciani highlighted an increase in competition due to subsided cellphones, a 3G growth surge, and an increase in the number of cities with fiber optic networks and wireless antennas.

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