Brazil minister admits geopolitics played role in 5G decisions

Brazil’s communications minister Fábio Faria admitted at a press conference with international correspondents on Thursday that geopolitics played a role in the government's decision to veto Chinese suppliers from the network that will be built for the exclusive use by the federal administration with resources from the 5G auction.

The minister also said there are legitimate concerns about the security of sensitive information, although he recalled that, in 2011, the US spied on then-Brazilian president Dilma Rousseff and federal government agencies, in a scandal revealed by Edward Snowden.

Faria cited the US, Germany, Finland, South Korea and Mexico, among others, as countries that have or are implementing separate networks from commercial networks for government data traffic. Also, according to the official, "every country tendering 5G is also creating dedicated government networks."

In Latin America, none of the countries that are working on bidding processes for 5G, however, has specific projects for private government networks. Chile, which held its 5G auction in April, has not decided on the creation of a private network.

Asked by BNamericas about what technical evidence the government has that some network providers would be more trustworthy than others, Faria did not respond directly, but stated that the government did not single out any particular company, only set stricter security standards for the supply to the government network.

The federal government itself, through the data processing service Serpro, recently signed a new contract with Huawei. Reminded of that by BNamericas, Faria did not comment on the apparent contradiction.

The minister named Ericsson and Nokia, among others, as companies that according to him are "specialized in private networks” in the world.

"A Huawei partner is a member of the Chinese Communist Party," Faria said, adding: "But we didn't put that as an impediment."

However, he admitted that it is difficult to fully avoid security problems and said: "A chipset is too small, you can't tell if it has a backdoor."

However, backdoors, which are a method of entry into systems (software, platforms, devices, etc.) by manufacturers and supposedly allow for spying, are not found in chipsets, but in network equipment or software.

Despite the restrictions to the government network, Huawei is allowed to provide equipment to commercial 5G networks in Brazil.

TENDER TERMS

According to Faria, issues cited by the technical area of audit court TCU regarding the 5G auction are “normal.” 

In a report, TCU’s technical area pointed out serious inconsistencies and even “illegalities” in the 5G auction proposal made by regulator Anatel.

On Wednesday, however, ignoring the technical report, seven of the nine court judges voted to approve the proposal. The case will be concluded next week.

Faria said the government expects a favorable outcome – TCU judges can still change their vote – and to carry out the auction by the second half of October, at the latest.

Faria also said there will be active 5G networks in some Brazilian state capitals by the end of the year. 

The minister stressed that the tender will not be focused on fee collection for the government.

The tender value was set at around 45bn reais (US$8.3bn), of which roughly 8bn reais refer to the payment of licenses to the government and 37bn reais to investment obligations by the tender winners.

Also present at the press conference, Leonardo de Morais, president of Anatel, said it will be the biggest frequency auction in Brazil's history – 3.7GHz in the 700MHz, 2.3GHz, 3.5GHz and 26GHz bands will be tendered.

Morais also estimated that the technology should bring in about 150bn reais in investments in the coming years.