Uruguay significantly increases amount of spectrum for mobile

The Regulatory Unit of Communications Services (URSEC) in Uruguay has assigned 125 MHz of spectrum in the 700 MHz and 1700/2100 MHz (AWS) bands to three operators for $111.5 million. Claro and Movistar Uruguay bid for their lots, while state-owned Antel purchased previously reserved spectrum. Uruguay is the latest country in Latin America to release 700 MHz spectrum, as Digital Dividend frequencies contribute to the further development of 4G services in the region.

Operators secure 125 MHz of new spectrum assigned to mobile services

The auction, organised by URSEC, took place on 14 August 2017. After three rounds of bidding in the 700 MHz and AWS bands, the results were as follows: * Claro (America Movil) purchased 20 MHz in the 700 MHz band (718–728/773–783 MHz) for $20.2 million and 20 MHz in the AWS band for $15 million (1755–1765/2155–2165 MHz) * Movistar Uruguay (Telefónica) invested $30.9 million in 30 MHz in the 700 MHz band (703–715/758–773 MHz) * 30 MHz in the AWS band remained unsold (1765–1780/2165–2180 MHz)

Prior to the auction, URSEC assigned 40 MHz in the 700 MHz band (728–748/783–803 MHz) and 15 MHz in the 2.1 GHz band (1920–1925/2110–2115 MHz FDD and 2120–2125 MHz TDD) to state-owned operator Antel. The total price paid by Antel ($45.4 million) was determined by the average final bids by Claro and Movistar for their lots. All the licences are valid for 20 years and oblige operators to deploy networks in the new bands within 24 months.

The final prices were slightly above the reserve prices, which were $10 million for a 2×5 MHz block in the 700 MHz band and $7.5 million for a 2×5 MHz block in the AWS band. The final price for 700 MHz reached 0.30 $/MHz/pop – similar to auctions in Panama and Peru. However, the final prices for AWS were higher than in most nearby countries – 0.22 $/MHz/pop, similar to Paraguay but significantly higher than Colombia, Peru and Costa Rica ($0.06–0.10). High reserve prices for the AWS spectrum are a possible reason why 30 MHz in this band went unsold in Uruguay, with operators prioritising the 700 MHz coverage spectrum.

Release of Digital Dividend spectrum gains momentum in Latin America

Several Latin American countries have assigned spectrum in the 700 MHz band (bands 12, 13 and 17) to mobile services. Bolivia was the first to deploy 4G networks in the 700 MHz band at the end of 2012; other countries followed from 2014 (Argentina, Brazil, Chile, Panama and Peru). Additional Latin American countries plan to assign 700 MHz spectrum during 2017/2018: Paraguay, Honduras, Venezuela, Colombia and Costa Rica. The release of Digital Dividend spectrum across Latin America will help drive the rapid increase of 4G coverage in the region – from 66.8% of the population in 2016 to 84% by the end of 2020 according to GSMA Intelligence forecasts.

The recent spectrum auction has significantly increased the amount of spectrum dedicated to mobile use in Uruguay from 210 MHz to 335 MHz, in line with the general trend in the region. On average, Latin American mobile operators have increased their national spectrum holdings from 223 MHz in 2012 to 336 MHz in 2017. With more spectrum available to mobile services, operators will be able to accommodate the ever-growing demand for data transfer.

Figure 1: Mobile spectrum holdings in Uruguay compared to average assigned in Latin America
Source: GSMA Intelligence