Thursday, July 24, 2014

Brazil: Telecom Italia Interested in Investing US$1.8 Billion Annually

According to The Latin American Tribune, the CEO of Telecom Italia said on Wednesday (July 23) that the company will invest some 4 billion reais ($1.82 billion) annually in Brazil over three years and participate in the country’s upcoming 4G auction.

Those investment plans do not include funds set aside for acquiring a new license to offer expanded 4G service on a new frequency band, Marco Patuano said after a meeting with Brazilian President Dilma Rousseff.

TIM Brasil, which is a unit of Telecom Italia and one of Brazil’s largest wireless operators, already offers 4G LTE mobile broadband services in the country.

Brazil will auction off licenses to offer 4G service on a new frequency band in September 2014, an announcement that has attracted interest from the country’s largest operators.

Patuano acknowledged that TIM Brasil’s wireless services still cannot be considered “first-world” caliber and therefore said new investment is needed.

He said he reaffirmed Telecom Italia’s interest in Brazil during his meeting with Rousseff.

COMMENT: “We’re interested in making investments for the growth of mobile broadband. Brazil is going through a revolution and has a young population that wants Internet that’s faster and cheaper all the time,” Patuano said.

The CEO did not comment on Brazilian anti-trust regulators’ demand that Spanish telecommunications giant Telefonica--owner of the Brazilian market’s No. 1 wireless operator, Vivo--either reduce its share in Telecom Italia or persuade TI to sell its Brazilian unit to another company.

“Telecom Italia’s strategy is independent of that of any shareholder, including Telefonica. It would not be appropriate for me to comment on the views of Brazilian anti-trust authorities,” he said.

Patuano likewise said Telecom Italia is not ruling out a possible merger in Brazil with broadband carrier GVT, a unit of French group Vivendi, although he added that that possible tie-up is not a priority at the moment.