By the Blouin News Technology staff

Challenges remain for 4G in Latin America

by in Enterprise Tech.

Vanice Luna speaks on her cell phone in Rio de Janeiro, Brazil. YASUYOSHI CHIBA/AFP/Getty Images

Vanice Luna speaks on her cell phone in Rio de Janeiro, Brazil. YASUYOSHI CHIBA/AFP/Getty Images

As the United States watches its available spectrum fly off the shelves for prices much higher than anticipated, Latin America is facing a continuing struggle to implement higher-speeds for mobile and broadband. While each Latin American country has a different approach to wrangling its spectrum for internet use, the region as a whole is forecast to have more than half of its coverage under the LTE umbrella by 2020, according to Swedish technology giant Ericsson.

In its latest mobility report, the company predicted that LTE coverage will extend to over 65% of the Latin American population by 2020. With coverage currently reaching 20% of the population, that leaves six years to cover another 45% of the region.

Latin America faces significant challenges in trying to develop higher-speed technologies. The need for countries to liberate their spectrum is key. Spectrum liberalization means that — while technical requirements are needed to avoid interference while using available frequencies — the terms of a license should not require the airwaves be used for a specific service or technology.

Ericsson says that the availability of a wide range of LTE devices and business models to monetize investments is another challenge to the adoption of 4G in the region. Although over 40 LTE networks have been launched in 18 countries in Latin America, change are necessary in order to achieve the kind of coverage Ericsson predicts for 2020. And some states are working on it:

  • Brazil recently attempted an auction of its 700MHz spectrum for 4G LTE, though the results were disappointing. The auction’s winning bids came in at nearly no premium over the minimum prices, and two out of the six blocks available ended without a bid. Also, one of the country’s major telecom companies did not participate.
  • Colombia has been attempting to step up its mobile communications strategy, and recognizes that making spectrum available is a vital step — or at least its communications technology minister Diego Molano has said as much. Colombia’s National Spectrum Agency has decided to allocate an additional 25 MHz of spectrum for mobile services in the coming months.
  • Argentina’s government reports that it received bids worth $2.2 billion in an auction for 3G and 4G licenses in early November. The amount bid for the communications frequency licenses was 14% above the $1.97 billion minimum set by the government for the auction.
  • Chilean telcos reportedly proposed a multi-billion dollar public-private investment plan that will span a decade, and aim to cover 80% of the population with 4G and fiber optic broadband infrastructure.

So, while projects are brewing, serious obstacles remain, ranging basic infrastructure development to financial investments. Regardless, the LatAm 4G sector will be one to watch over the next few years — especially as foreign tech giants eye the money to be made in these burgeoning markets.