Peru operators may get spectrum in exchange for coverage investments

To boost 5G and better utilize the network, Peru will assign spectrum directly and allow operators to commit to coverage investments instead of paying in cash.

The transport and communications ministry's (MTC) legislative decree No. 1627 will allow operators to invest in closing telecoms gaps in rural areas or places of preferential social interest as compensation for the spectrum they receive.

Operators are not required to provide 5G and may focus on 4G technology for those commitments.

The ministry will launch a call for expressions of interest, which must take into account frequency bands to be delivered, band occupation, spectrum caps, value and mandatory investment commitments, among others.

The decree represents an additional way to assign spectrum because Peru also plans to hold an auction in January. It is not clear if the arrangement will also apply to the auction.

5G is currently deployed under the non-autonomous standard, that is, through a network shared with 4G, which limits development of the technology.

According to MTC data, only 30 of Peru's 1,891 districts had partial 5G coverage last year.

“5G will allow for the massification of connections by devices without losing quality in transmission, enabling applications such as the internet of things, telemedicine, tele-education, automation and remote management, among other applications,” transport and communications minister Raúl Pérez Reyes said in a press release.

The January tender is planned to involve 300MHz in the 3300-3400MHz and 3600-3800MHz bands, as well as 800MHz in the 25.9-26.7GHz band with national coverage.

Investment promotion agency ProInversión initially estimated reference amounts of US$759 million for the 3.5GHz band and US$85.8 million for the 26GHz band.

Under the decree, the values may also be paid in investment commitments. MTC will have to contract spectrum valuation studies to define the final prices.

PERUVIAN MARKET

Peru has 769MHz of spectrum allocated for mobile services, according to the latest data from 5G Americas.

It has 90MHz assigned in the 700MHz band, 80MHz in AWS bands and 60MHz in extended AWS, 120MHz in 1.9MHz, 47 in 2.3GHz, 124MHz in 2.5GHz and 148MHz in the 3.5GHz band, among others.

The latter band is the prime one for 5G.

The MTC decree also adapts pre-existing spectrum assignments, so that they are grouped into continuous spectrum blocks.

In Q1, Peru registered 41.9mn mobile lines, up 1.66% year-on-year.

Claro maintained leadership with a 30.2% market share, followed by Movistar with 28.2%, Entel with 22.4% and Bitel with 18.8%.

Virtual mobile operators Dolphin Mobile, Flash Servicios, Guinea Mobile, Suma Móvil, Intermax and Dolphin Telecom together represented 0.45% of the market.