In a decision made on June 21 2000, the national telecommunications agency (ANATEL) opted for the 1.8 gigahertz (gHz) frequency for the Personal Communications System (PCS), leaving the 1.9 gHz band for the IMT-2000 (ie, the third generation of cellular telephony, which permits broadband transmission including voice, video and high speed internet) and allowing for the entry of Global System for Mobile Communications (GSM) in Brazil. Resolution 227 was published in the Official Gazette on June 26 2000.
After more than a year of intense discussions with respect to the frequency band and technology to be adopted in Brazil for the PCS, ANATEL and the Ministry of Communications announced the decision to allocate the 1.8 gHz frequency band for the PCS.
The decision was received with surprise, as ANATEL had indicated a preference for the 1.9 gHz band, aligned with the time division/code division multiple access (TDMA/CDMA) standard widely used in the United States. The Ministry of Communications 's announcement, which was to be made in the United States, seemed to indicate that the decision would be favourable to US companies.
The intense discussion involving (and pressure suffered by) ANATEL for the choice of the PCS frequency addressed a number of issues, including:
- the use of national and international roaming;
- the price of terminals (as affected by mass production);
- the possibility of the implementation of third generation cellular phones; and
- the use of infrastructure already in place.
Of all the issues, there was only consensus on one point: whichever frequency band was chosen, the decision could not be perfect, as it was impossible to reconcile all the positive points of each of the possible bands.
Thus it was with careful consideration of the benefits and disadvantages of each of the options that ANATEL's executive board approved the 1.8 gHz frequency band for the PCS. The only dissenting vote was that of ANATEL's president (a majority vote was sufficient).
ANATEL has since announced that it will be making the PCS exploitation model available for public consultation at the beginning of July.
It seems likely that exploitation of the PCS will be undertaken by the current cellular telephony operators. However, they will not be able to exploit the service in the same area in which they already operate, requiring therefore that they abandon one of their authorizations. ANATEL has also indicated that the authorizations will be local.
Another expected decision is that fixed-telephony concessionaires will not be allowed to participate in the PCS invitations to bid. However, next year there may be the granting of a national licence, in which the fixed-telephony concessionaires may be able to participate. Participation will be on the proviso that they undertake to achieve universal access goals by the end of 2001.
Even without clear rules, the companies that adopt the GSM standard (eg, Alcatel, Siemens and Nokia) are already taking steps and negotiating with cellular telephony operators interested in exploiting this promising market.
The frequency band selection process for the PCS was certainly an illustrative milestone of the legal and regulatory environment in Brazil's telecommunications industry. ANATEL has strived to promote wide discussion on the subject (eg, holding public hearings, public consultations, meetings and events). In turn, the companies have made every effort to show the advantages of each technology, promoting discussion and addressing various aspects involved in the choice of the standard to be adopted. There was political pressure imposed, resulting in the visit of various authorities to Brazil, seeking to influence ANATEL's decision.
In spite of the pressure to which it was exposed, the agency remained inexorable and presented a transparent decision, duly justified by the executive officers. This highlighted the independence of Brazil's regulatory Agency and a firm commitment to the development of the telecommunications sector.
For further information on this topic please contact Ricardo Barretto or Jose Leca at Barretto Ferreira, Kujawski, Brancher e Gonçalves – Sociedade de Advogados by telephone (+55 11 3066 5999) or by fax (+55 11 282 8735) or by e-mail ([email protected] or [email protected] ).
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