By the first quarter of next year, Brazilian carrier Oi will start to offer LTE services in the state of São Paulo. The state is not included in the telecom agency Anatel’s coverage obligations (according to the agency’s rules, carriers need to cover all the offices of the Confederations Cup by April 2013). Even before São Paulo, Oi said it will launch LTE services in Rio de Janeiro, where trials have already been conducted.
Follow us on Twitter, Facebook and subscribe to our free periodic newsletters
Oi has chosen Alcatel-Lucent, Ericsson and Nokia Siemens Networks
as LTE vendors. The choices were announced during the Futurecom event (check out all stories), and at that time, Oi’s COO, James Meaney, said the carrier might concentrate its largest investments on LTE instead of HSPA+. “We are betting on skipping HSPA+ to go direct to LTE,” Meaney said.However, on Friday, Valim said that Oi will keep investing in 3G. “It will depend on how fast LTE will be adopted, and devices are the most critical issue, both their price (which is very high) and availability. Networks will be ready before the devices,” he explained. According to Valim, currently Oi’s 3G network covers 70%-80% of the Brazilian population, totaling 6 million lines. “We are focusing on the ABC concept: always the best connection—to give customers the best connection that they can use,” he said.
Under the LTE auction rules, carriers are obliged to share infrastructure. In fact, they have signed an agreement to share new LTE sites. At the press conference, Valim said Oi owns about 6,000 towers for wireless service and 8,000 focused on fixed operations; currently 30% are shared.
Valim believes that more sharing will happen in 2014, when effectively carriers will have to build new sites for LTE coverage to reach new areas.
São Paulo opportunities
Oi was the fourth company to start providing services in the large São Paulo state. The carrier began a very aggressive marketing campaign in October 2008 to attract customers by offering low priced, pre-paid chips. Four years later, Oi’s São Paulo state business accounts for 10% of the company’s total net revenues, and for wireless revenues alone, São Paulo represents 20%.
Just this year, Oi is set to invest about U.S.$240 million (R$480 million) to increase its operations in the state. Since the operation began in São Paulo, investment has risen to a total of U.S.$2 billion (R$4 billion). “We grew our post-paid subscribers’ base in São Paulo by 35%. We have 9 million customers in the state, 60 stores and 14.2% of market share,” Oi’s president Valim told company employees during the launch of new building in São Paulo.
Valim noted the company owns 3,216 sites in the state (and about four or five times the number of radio base stations), which cover 99% of its population. Approximately 80% are covered by 3G.
