The winning bidders in Brazil’s recent 700 MHz spectrum auction have made their first payment into a fund that will contribute to the costs of switching analogue TV signals to digital.
Claro, Vivo, TIM and Algar Telecom together paid 1.44 billion reais (€440 million) into the fund, according to an Estadao piece published by R7 on Sunday. The fund, known as EAD, was created in the last month, the report said, quoting José Alexandre Bicalho, planning and regulatory head at Anatel.
That sum constitutes 40% of the total amount the telcos will pay into the EAD. The remainder will be paid in two instalments in the next two years.
The telcos will together contribute BRL3.6 billion (€1.1 billion). The majority will be split between the big three – America Movil’s Claro, Telefonica-owned Vivo, and Telecom Italia’s local unit TIM will pay BRL1.19 billion each – while Algar Telecom is responsible for the remaining BRL18 million.
The telcos have a strong interest in facilitating the transfer of television signals, since until that occurs they will be unable to use the 700 MHz spectrum they bought last year, Bicalho said.
Brazil raised BRL5.85 billion in its sale of 700 MHz spectrum in October. Claro, Vivo and TIM won nationwide 700 MHz licences, paying between BRL1.93 billion and BRL1.95 billion each, while Algar Telecom picked up a licence covering the four states in which it operates for BRL29.57 billion.
Two of the six licences on offer did not attract any bidders.
Brazil’s fourth largest mobile operator Oi did not take part in the contest.
When it announced the results of the competition, Anatel noted that the winning bidder would be expected to bear the cost of any measures required to avoid interference with digital TV services and the cost of migrating the TV channels to their new frequencies.
