Spanish company begins offering faster mobile, Internet connections in some BA areas
4G technology to surf the Web through mobile phones will be available in the country starting today, after Movistar activated its first bases for the service in downtown Buenos Aires.
The area initially covered will be small, while a majority of mobile phones owned by Argentines do not currently support the technology, but providers and analysts agree that next year the service will grow quickly.
The consequence of 4G’s launch will be faster Internet connectivity, as the technology allows speeds around ten times faster than 3G, opening the door for services which need more data transmission, such as video on demand.
It will also free up radio spectrums for the currently congested 2G and 3G services, although questions remain over the problems that the reduced amount of spectrum released by the state so far will have on the effectiveness of investments.
To access 4G, Movistar’s users will need to replace their current chips and have an “LTE-compatible” phone.
Movistar, the cellphone provider controlled by Spain’s Telefónica, completed the purchase of radio spectrum suitable to offer the service in big cities last week, as it brought US$209 million into the country to pay for it last Tuesday, one week after Claro, and a day before Telecom, its two main competitors.
Less than a week after that, Telefónica will be the first to launch in some areas of Buenos Aires’ city centre, as investment and technical adaptations needed were done in advance for them, assuming the 4G tender would take place smoothly. Only the final transmission tests waited until all the steps of the auction were completed and the spectrum was handed in by the state.
“You can’t really do a 4G deployment from scratch in 30 days. Telefónica made a bet that they were going to get the needed frequencies and that means now they can hit the market first,” the President of the Argentine Chamber of Small and Medium Telecommunications Providers (Cappitel) Pablo Perelmuter told the Herald.
In his view, however, its competitors will shortly follow, as market dynamics dictate the need to offer equivalent services as soon as possible.
According to Telefónica, 200,000 of its users have phones suitable for 4G use, but they will need to purchase a specific 4G-compatible chip to complete the switch.
INFRASTRUCTURE INVESTMENT
Although the launch of 4G services will require infrastructure investment, Movistar’s initial service will rely at least partly on what it already had to exploit its new frequencies. “Deployments aren’t terribly hard, if you already have the tower, the cables, the antennae... you re-use a large part of the 3G infrastructure, with some adaptations, more batteries and so on, but as long as you have the site for the tower secured and the tower’s services are not collapsed, you can use what you have adapting it to 4G,” Perelmuter explained.
He was, however, critical of the companies’ decisions in the last few years. “They have behaved as rent-seekers instead of service providers. Latin America and especially Argentina has seen larger profits for mobile phone providers than Europe, but investment has been missing despite these extraordinary profits,” Perelmuter said, calling for “smart” state intervention to guarantee better services.
Yesterday, Movistar suffered from an “electrical problem” in one of its bases, which put users in Buenos Aires City out of service before sunrise.
Last week, Claro suffered larger problems, which even led Public prosecutor Guillermo Marijuán to formally denounce them for leaving million of users without service.
Specialists agree that the arrival of 4G should improve the situation, both by increasing the amount of spectrum available and due to new infrastructure investments.
Perelmuter was optimistic in this last sense. “2015 will be a year with a lot of demand for the small and medium-sized companies that work in development for telecommunications providers.”
FUTURE REACH
The conditions specified by the Communication Secretariat’s in its call for tenders state that companies have 18 months to complete “stage one” of service provision, after which all the provinces’ capitals, plus big cities such as Rosario, Bahía Blanca, Mar del Plata, and an additional 13 “corridors” connecting big cities between them (the roads between Buenos Aires-Rosario, Rosario-Córdoba, Buenos Aires-Mar del Plata and others), should have working 4G services.
But specialists have noted that the so far unexplained state delay releasing part of the 4G spectrum won by companies at the auction (specifically, the parts located at the 700-MHz band) could make some of this goals more difficult or expensive.
The missing 700-MHz band has a lower frequency than the other bands released, which means that even if it struggles in high density cities, it is more effective for longer distances, making it ideal for less populated areas.
Telefónica, however, already promised to comply with at least a large part of the conditions required in stage one.
“By the end of next year, the company will have covered the totality of the provinces’ capitals, in agreement with the goals established in the call for tenders,” Telefónica said this week in a statement.
From stage two onwards, the lack of spectrum in the 700-MHz band could prove more problematic, as landmarks required by the state are related to smaller cities.
In terms of reaching the public, Telecom’s Personal has an edge over Telefónica: a large amount of their clients’ phones are already compatible with 4G technology, as they were sold with newer SIM cards, used to identify subscribers and connect them to the phone network.
Irrespective of which company each user is subscribed to, software updates will be needed in suitable phones to make them fully compatible.
Personal also announced yesterday it has already been deploying its 4G network, and expects it to be operation in the “main cities” by next year’s first quarter.
Although Claro was the first to pay for its frequencies, no news have emerged on its launching dates.
The fourth winner at the Communications Secretariat’s spectrum auction was Vila-Manzano’s ArLink, but frequencies for the national media group haven’t been relased by the state yet.
Source: http://www.buenosairesherald.com/article/177821/movistar-has-head-start-on-4g-technology
