Telebras signs first contract in Brazil’s National Broadband Plan

Telebras signs first contract in Brazil’s National Broadband Plan

Telecomunicações Brasileiras (Telebras) has signed its first contract to sell more affordable broadband in Brazil as part of the government’s National Broadband Plan (PBNL).

Telebras, a former state-owned monopoly, signed the contract with ISP Sadnet which operates in the city of Santo Antônio do Descoberto and the surrounding area.

Sadnet MD, Luiz Tomaz said that he expects the partnership with Telebras to double the company’s customers within six months from one thousand to two thousand users. TeleGeography’s Globalcomms database states that Brazil’s household broadband penetration rate had only reached 26.4% in March this year.

According to Reuters, in May 2011 the Brazilian government announced plans to invest $6.1 billion into the country’s broadband system. Of this figure, $2.03 billion was to be invested in Telebras. Its heritage as a state-owned company meant that it still owned millions of dollars worth of telecoms technologies but did not operate on a daily basis. Recent problems with Telefónica’s broadband network in the São Paulo state started discussion about restoring the former monopoly.

The main aim of the project is to provide internet to the low-income homes across the country.

"As we get the lower price provider for the end user, we are fulfilling our social role which is to enable internet access to as many people as possible, in particular the lower income population," said Telebras president, Caio Bonilla .

Bonilla commented that six more contracts should soon be signed by the state to deliver services between Brasilia and Itumbiara with further plans to enter into contracts with corporate partners.

“A national fibre broadband network addresses the fundamental challenge faced by the private operators: cost effective long-haul backhaul to the remote and less densely populated regions of the country,” said Wally Swain, SVP emerging market at analyst firm, Yankee Group. “With low-cost backhaul into these areas, mobile operators especially will be encouraged to roll out high-bandwidth wireless services from HSPA to LTE even in these remote/economically challenged regions.”

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