América Móvil turns on 5G engines in Latin America

América Móvil is starting to activate commercial 5G networks in some Latin American markets by using spectrum dedicated for the technology.

In this way the Mexican telecom giant is complementing the existing offer of 5G DSS, which combines spectrum from other technologies, such as 4G.

The spectrum awarded in 5G auctions has already been activated by its Claro subsidiaries in the Dominican Republic and Brazil, with both launches comprising a few antennas deployed in selected districts.

“We should see América Móvil doubling down on 5G, as other telcos also go out and about their launches,” Marcos Aguiar, telecom analyst and managing director for the Boston Consulting Group (BCG) in Brazil, told BNamericas.

Aguiar recommends caution in terms of the return on invested capital that carriers in Latin America will see from their initial 5G launches, and the fact that most devices are not yet compatible with the technology. 

BCG sees 90% of initial revenue from 5G-enabled applications being generated by 2025, primarily aimed at end-consumers, such as improving connectivity and speed of mobile and fixed broadband.

It estimates that most of the 5G gains will be captured in the long term with solutions focused on the B2B and industrial segments, which will lead to diversification and a change in operators' revenue mix.

In the case of the Dominican Republic, Claro's 5G activation was announced at the beginning of December by using the 3.5GHz frequency acquired in the October auction, and it is focused on mobile broadband for the end consumer.

"Today we’re taking a step towards a new era marked by digital transformation with the launch of our 5G service in the central polygon of the national district [in capital Santo Domingo] as part of the first phase of the deployment of this new infrastructure," said Rogelio Viesca, Claro’s president in the Dominican Republic, in comments earlier this month.

The central polygon area includes 29 sectors which already rely on 5G according to Claro. In the next few months, the company plans to take the service to Santo Domingo’s metropolitan area, Santiago, La Romana and other major cities in the country.

There are currently four smartphone models that are compatible with Claro's 5G technology in the Dominican Republic: one from Huawei and three from Samsung. 

Another 10 models, from Samsung, Motorola, TCL and Xiaomi are expected to be available between December and February 2022.

In the 5G auction Claro paid US$53.1mn for the use of 3.5GHz bands during 20 years. The other winner was Altice Dominicana, which paid US$20.6mn for spectrum during 14 years. The country's third operator, Viva, did not participate in the contest. 

Claro subsequently pledged to invest more than 7.58bn Dominican pesos (US$134mn) as part of the 20-year renewal of its concession contract, including the investments related to the spectrum acquisition.

As each of the operators already had around 30Mhz of spectrum in 3.5GHz, through a previously concluded spectrum refarming process, Claro, as well as Altice, has a total of 100MHz in the frequency to deliver 5G services.

BRAZIL

This week Claro Brasil activated 5G in the 2.3GHz band in selected districts of capital Brasilia and São Paulo.

Claro follows in the footsteps of Algar Telecom, which became the first telco to launch a commercial 5G network in the country with spectrum awarded in the November auction, also in the 2.3GHz band.

In Brasilia, a first antenna was activated in the city's Asa Norte district, with the Asa Sul and the commercial sector districts to follow in the coming days.

In São Paulo, Claro is carrying out a soft launch with sites in the Itaim and Vila Nova Conceição neighborhoods, with expansion to Marginal Pinheiros slated for the first quarter of 2022.

In addition to the 2.3GHz band, Claro acquired frequencies in the 3.5GHz (100MHz of spectrum) band and in the 26GHz (two national blocks of 200MHz) millimeterwave (mmWave) band in the auction. 

The 2.3GHz band can be used both for 4G and 5G. In Brazil, 4G is delivered over the 2.5GHz and 700MHz bands. The band most frequently used for 5G is 3.5GHz.

Claro has not yet provided an estimated date for the activation of 5G in 3.5GHz, which still needs to be cleaned up in many locations in Brazil. 

Of the smartphones on offer, there are certain compatible models from Samsung, Motorola and Apple. Claro has said it will only buy phones from manufacturers that are compatible with 5G from 2022 onwards.