Providing the backbone for Brazil's bandwidth boost

Providing the backbone for Brazil's bandwidth boost

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Netell, a Brazilian fibre firm, has seen demand for connectivity explode over its 16 years. James Pearce spoke to CEO Wagner Rapchan about links to international partners and the impact of OTTs

As more and more inter- national infrastructure has landed in Brazil, demand for fibre services within the country has continued to grow. The Latin American region is quickly catching up with the rest of the world in terms of telecoms, and it is Brazil that is leading the way.

Several new subsea cables connecting into the country have been announced or have gone live over the last few years. 2017 saw Seabras-1 – which connects São Paulo to the US – go live, for example.

One of the companies currently buying capacity on the Seaborn Networks cable is local fibre provider Netell Telecom. Wagner Rapchan, CEO at Netell, says: “We have a great working relationship, as Seaborn and Netell share similar business cultures as well as a commitment to customer service excellence.  Both companies have a clear vision for its business and the future of the industry and it makes things easier when we are partnering. 

He adds: “Netell provides a diverse, dark fibre backhaul solution from Seaborn’s cable landing station in Praia Grande as well as a dark fibre, mesh network solution to Seaborn’s points of presence in metro São Paulo. Netell has also purchased a substantial amount of capacity on Seabras-1, which it will use to serve its local, regional and international carrier and enterprise customer base.”

Launched in 2002 as an internet service provider, Netell offers backbone services throughout Brazil. With more than 200 million people living in the country, it is not really surprising that the demand for such services is on the rise.

“We are a competitive, entrepreneurial organisation built to serve our customers with seamless, high-performance connectivity in and around São Paulo.Netell has evolved into one of Brazil’s leading backbone network providers. Our experience as an ISP has taught us the importance of ensuring optimum end-user experience, and this has shaped our approach towards servicing enterprises, network operators and service providers without ever compromising on quality.”

So what are the main drivers behind the sudden burst of subsea and fibre deployments? Rapchan points to three key factors that he believes have seen demand increase to make it the seventh largest internet user in the world, according to Internet World Stats.

The first, he claims, is similar to many other global markets – the demand for over-the-top (OTT) services and social media, such as Facebook. According to Facebook’s own figures, it had 111 million subscribers in Brazil as of June 2017, making up 52.5% of the population.

“OTT players such as Netflix and Facebook are taking huge amounts of capacity on these cable systems going into Brazil as demand for their services grow,” explains Rapchan.

“The OTTs are a key driver for more capacity coming into Brazil. We’ve had one provider asking for 1Tbps of capacity in Brazil just recently – it is a key factor in the growth of services in the country.”

I ask if this is in response to demand from users, and he points to an example close to home to demonstrate how young people’s content consumption habits are influencing the marketplace.

“I spoke to my daughters about traditional broadcast TV channels and they said they never watch them. The young people in Brazil are very keen to use new technology and Netflix is one of the key sources of TV services. It has huge penetration in the country.”

Another reason for the drive in investment is sheer need for new, fresh infrastructure due to aged and creaking connectivity. A number of the existing subsea cables that have linked with North America will be approaching their twentieth year in service before long. This means they need to be replaced with newer, better infrastructure.

“The cables that are being deployed have begun to age. There are some pretty old systems running, so we have a lot of new cables coming in from the US. Cables from the US have traditionally gone from Miami through Central America to Fortaleza, then Rio, then São Paulo. The distance between the points of presence in the US and Brazil meant you needed some replication of the signal, but the new cables include a straight path from the US to Brazil. The new cables have better technology and this allows them to go further and that reduces latency.”

He also points to new transmission technology that allows for better connectivity in the country that can help meet the demand of subscribers.

Reaching 140 million

The jump in internet penetration is sharp. If we go back to 2000, two years before Rapchan founded Netell, there were around five million internet users in the country according to the International Telecommunication Union (ITU). That was just 2.9% penetration in a population of almost 170 million. Five years later this had jumped to 14% penetration, and this has continued to grow every year after. By 2008, ITU figures show 67 million people had internet access, and the figure is now nearer 140 million a decade later.

Netell’s customer base includes financial customers, enterprises, local providers and the international community. “Today a range of customers entrusts Netell with their bandwidth infrastructure require-ments: from financial institutions requiring low-latency architecture through to international network operators that need reliable network infrastructure to deliver content seamlessly throughout Brazil,” Rapchan tells me. “For over a decade, we have grown organically by assisting local and international enter-prises and service providers with deploying the highest-quality access in Brazil.

He adds: “As demand for connectivity grows, we will always continue to match performance with proactive support so as to ensure the delivery of the best in quality of experience to all of our customers.”

It currently runs a fibre metro network that consists of 400km of its own fibre, 18,000km of national fibre partners and over 40 points of presence across 10 Brazilian cities. It also has over 40,000km of long-haul network across Brazil which includes highly resilient bidirectional switched rings which are geographically diverse, with the DWDM layer providing optical channels at 1Gbps, 2.5Gbps, 10Gbps and 40Gbps.

It also has connections in data centres including Terremark, UOL-Diveo, Locaweb, ALOG/Equinix, GBLX/Level 3.

Brazil is fast becoming a core transportation hub with new subsea cables landing there. What opportunities does this present for your company, I ask, and how do you plan to seize them?

“We are committed to helping our partners be successful and delivering critical capacity that will support the growth of the Brazilian market,” he replies. “We own a unique solution connecting the CLS directly to any data centre in São Paulo with Express Routes. It means we are in the core of these hub of connectivity between Brazil and other countries and being a neutral boutique dark fibre-optic and telecommunications solutions provider represents an assured growth in the next years.”

The likes of Seaborn, Facebook, Google, Telefónica, Sparkle, China Unicom, Angola Cables and many others are all investing, or have invested, in new subsea cable systems into Brazil. So I ask what he wants from the new wave of international partners that are entering the Brazilian markets?

“We offer fibre infrastructure in cities across Brazil that help our partners rapidly grow their reach in the country. Companies from all over the world can benefit from our simple business model with high quality, low latency networking. We make it simple and easy to connect and be successful in local markets across Brazil.”

Last year, Netell announced the completion of the shortest commercially available underground fibre network route between Praia Grande and São Paulo. It also completed a metro underground fibre ring, including new network paths to major data centres in São Paulo and another metro ring connecting the cable landing stations in Praia Grande.

I ask what to expect from Netell in the coming year, and Rapchan points to fibre-to-the-home (FTTH) as a key element of the carrier’s strategy.

“We now have a network footprint covering more than 26 cities and several enterprise campuses throughout the state,” he explains. “We now are focusing on the rapid growth of the FTTH business in these locations through our other companies under Netell Group,” he says. 

“We already have the fibre infrastructure and the IP that would be necessary to speed up our growth in the next decade.” With the rise in demand for internet services continuing in Brazil, you wouldn’t bet against it. 

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