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Brazil telecoms watchdog monitoring 5G plan, says delay talk premature

Brazilian telecoms regulator Anatel said on Thursday it was closely monitoring to decide whether to postpone the country’s fifth-generation mobile network (5G) spectrum auction due to the coronavirus outbreak while insisting that it remained premature to discuss a delay.

“So far, it is still possible to carry out the bidding process at the end of 2020,” Anatel said in a statement, noting it is monitoring “how the current scenario evolves” to decide whether the auction should be put off until the first two months of 2021.

The regulator has approved spectrum availability and other bidding rules, which are under a public review expected to be concluded by April 17. If confirmed, it could mark the world’s largest bandwidth auction for 5G to date.

“Any analysis indicating the need for a delay is considered premature at this point,” the regulator added.

Keeping the scheduled date would be a blow for local carriers, which in recent days have scaled up appeals for a delay in Brazil’s 5G auction as uncertainties mount amid the fast-spreading pandemic.

“Since 5G requires investments in the billions, these companies need long-term predictability and that’s something we don’t have at the moment,” said Carlos Daltozo, co-head of equities at research firm Eleven Financial Research.

He noted, however, that telecommunications firms are among the few sectors experiencing a boost in demand since governments scaled back non-essential services to slow the coronavirus outbreak, forcing schools to suspend classes and companies to either halt activities or get employees to work from home.

“Telecoms is seen as an essential service… In my case, I had to boost broadband service to support home office, my kids schooling and entertainment,” Daltozo said.

Brazil’s four major carriers Telefonica Brasil SA , TIM Participacoes SA, America Movil’s Claro and Oi SA have seen broadband usage grow between 12% and 49% from March 30 to April 5, according to Anatel.

The all-time peak was seen earlier in March, when one of the carriers reported a 70% rise in traffic, the regulator said, adding a crisis committee was created to supervise network performance in Brazil.

Telecoms firms have boosted mobile data and broadband services and stopped charging for some TV channels, among other offerings, which according to Daltozo could ultimately change consumer behavior.

“This coronavirus crisis is definitely changing consumption patterns,” he said.

―Financial Post

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