Brazil's Oi signs broad-ranging deal with Huawei

Brazilian telco Oi signed a major deal with Huawei as part of its corporate restructuring, with a focus on expanding and modernizing the network, particularly fiber, and increasing mobile coverage.

The deal was inked Tuesday at the Chinese supplier's Shenzhen headquarters. Values have not been disclosed, but Oi said strategic investments would be supported by a 4bn-real (US$1.08bn) planned capital increase from new investors.

The already initiated projects are being carried out with resources earmarked in this year's budget.

A new business model is being adopted for the deployment of FTTH infrastructure in order to accelerate the offer of the Oi Fibra and Oi TV packages, Oi said in a statement.

The telco said it wants to invest in a just-in-time format, avoiding the construction of idle infrastructure and more promptly meeting customer demand.

The new model seeks to maximize the profitability of existing assets and is already being implemented in some municipalities, Oi said.

Oi also aims to expand 4G and 4.5G services with the gradual migration and disconnection of 2G and 3G.

The telco said it aims to have its mobile network ready for the deployment of 5G when this technology becomes available in Brazil.

Unlike its main competitors, Oi does not own bands in the 700Mhz spectrum, only in the 2.5Ghz one.

Oi's strategic plan also includes the modernization and adaptation of the network to internet of things.

The telco said new contracts with Huawei and other providers will bring greater operational efficiency because there will now be some standardization of suppliers by technology and/or region in Brazil.

The new contracts establish projects to be completed in up to five years.