The Brazilian Ministry of Science, Technology, Innovation, and Communications (MCTIC) published on Monday, February 3rd, Ordinance #418 that establishes guidelines for the public bid of licenses for the fifth generation of mobile technologies, known as 5G. With the publication, the National Telecommunications Agency (ANATEL) will define the technical criteria to launch for public bid.

The first meeting of the ANATEL’s Board of Directors, after the Ordinance’s publication, is already scheduled for February 6th. The discussion on the proposal for the 5G public bid was included in
the meeting’s agenda. The 5G public bid will be held by ANATEL under the Investment Partnerships Program (PPI), as defined by the Federal Government in November 2019. This indicates that the Government chose to give a higher importance to the bid, by including it in the PPI portfolio, as 5G systems will play a key role in the development of Brazil’s telecommunications services and business.

Once the bid proposal and its documents are approved by the ANATEL’s Board of Directors, the next steps include public consultation and the Federal Audit Court (TCU) approval. The following timeline illustrates the potential deadlines foreseen by the Government.

It is expected by the government that the bid will take place in the second half of the year and it will involve the offer of licenses in the 700 MHz, 2.3 GHz, 3.5 GHz and 26 GHz bands. It is important to note that for the 2.3 GHz, 3.5 GHz and 26 GHz bands, ANATEL defined that TDD (time division duplexing) technique should be used, unlike the 700 MHz band where TDD is allowed.

The blocks of each frequency band will be confirmed by ANATEL at the time of the bidding project ́s approval by the Board of Directors. According to the Ordinance, ANATEL should provide the largest viable number of spectrums in all bands and encourage the sharing of networks.

One of the Ordinance ́s highlights provides that ANATEL must define the technical criteria for the operation of the new mobile communications system service in the 3.5 GHz band without harming the open TV signal offered by satellite dishes in Band C (via satellite). The Ordinance also indicates that an entity should be created to apply resources designated to this matter.

There are also expectations that the Agency will increase the frequency offer for the bid. The 3.5GHz band will likely be expanded to provide another 100MHz. If this does happen, there will be an offer of 400MHz in this frequency range only.

Along with the development of 5G in Brazil, it will be necessary to develop new business models and its regulation in order to follow the technological transformation. One of the discussions that can be dealt by ANATEL regards revenue share models and technology companies, that play a relevant role within the 5G system in conjunction with telecom operators.

Among the guidelines established by Ordinance #418 of January 31st, 2020, MCTIC established the following premises for ANATEL:

• Establishment of a model that makes it possible to maintain or increase current levels of competition;
• Focus in sharing of active and passive infrastructure between providers;
• Commitment to support mobile broadband using 4G technology or higher for isolated and agglomerated urban areas, according to the classification of the Brazilian Institute of Geography and Statistics (IBGE), as provided in Federal Decree #9.612, 2018;
• Commitment to cover federal highways with mobile broadband and high-speed transport networks, preferably in optical fiber, for municipalities not yet served;
• Definition of deadlines for the activation of the services in the licensed bands, and, if requirements are not met, allow the use of the band by interested third parties, with protection guarantees.

The Ordinance is aligned with Brazil’s telecom public policy, established in Federal Decree #9.612, 2018 and makes direct reference to its objectives, such as: a) to provide a favorable environment for the expansion of telecommunications networks and for the continuity and improvement of services provided; b) to guarantee the rights of users of telecommunications services; c) to stimulate research and technological and productive development and measures that promote the integrity of the telecommunications infrastructure and the security of the services that are supported by it; and d) to encourage constant technological updating of telecommunications services.

To read MCTIC’s Ordinance #418 of January 31st, 2020, in English, click here.