We've got 4G in Brazil! Oh, wait...
Last week, the four largest mobile operators in Brazil launched their 4G commercial offerings across the cities where the Confederations Cup will take place this year — but not without concerns over whether it will be a reality.
The local firms that have auctioned for 4G spectrum (Vivo, Claro, Oi, and TIM) had committed to provide at least 50 percent of urban area coverage in the Confederations Cup host cities. But some operators seem to be ahead of schedule, and customers in other locations — such as the most densely populated city in the country and World Cup host, São Paulo — can already buy 4G services.
One of the operators, Claro, said that by May 1, its 4G product had already attracted 20,000 new users. The telecoms regulator, Anatel, predicts that by December, 4 million people will be using the technology.
It all sounds good in theory. But is the Brazilian offering of 4G what it really says on the tin?
The promise of a tenfold speed increase in mobile connections offered by the 4G novelty should not distract customers from the fact that operators have barely managed to cater for 3G voice and data.
Availability is the key area of concern. Consumer rights association Reclame has already released a statement that advises consumers against buying 4G services at this stage. According to Reclame, the 4G network is hardly worth the cost, since it will initially operate at a frequency of 2.5GHz, when in reality, the ideal rate is 700MHz — which means consumers buying 4G coverage may get a 3G signal until fourth-generation coverage is available.
Brazilian Communications Minister Paulo Bernardo dismissed the claims, saying that consumers are "intelligent", and that the warnings will not stop them from buying the services. "Brazil will stage the first large-scale 4G test in the world," the minister added.
It is certainly not a cheap test. The monthly cost of 4G services to end consumers varies from R$34.90 ($17.35) for a 600MB data plan to R$98 ($48.76) for a 5GB option. The amounts are exclusive of the voice plan, which is charged separately. Handsets compatible with the 4G technology include the Motorola RAZR HD, Samsung Galaxy S III LTE, which can cost as much as R$1,900 ($945.39) and R$1,400 ($696.65), respectively. Average individual monthly income within the so-called "emerging middle class" in Brazil is R$1,019 ($507.12).
Finally, the promise of a tenfold speed increase in mobile connections offered by the 4G novelty should not distract customers from the fact that operators have barely managed to cater for 3G voice and data. According to the telecoms regulator, 40 percent of Brazilian mobile phone users are unhappy with the 3G services they currently get.
In July 2012, an 11-day ban was imposed by the government on signing up new clients on three of the four operators due to poor provision of services. And last month, the telecoms body fined TIM in R$9.6m ($4.7m) for supposedly dropping calls on purpose, to force customers to redial and therefore increase its takings.
So, contrary to what the Brazilian politicians are saying, "intelligent" consumers should remain very wary of 4G for some time to come.