Caio Bonilha, President of Brazilian operator Telebrás is appearing at the Broadband LATAM conference taking place on 2 – 3 July 2013 at the Grand Hyatt, Sao Paulo, Brazil. Ahead of the show he tells us more about Telebrás’ strategy for the next few years, what’s hot in terms of technology and why Brazilian broadband is moving ahead in leaps and bounds.
According to Informa stats, only 30 per cent or so of households in Brazil have a broadband connection compared to an average of 80 per cent in Europe. Why is there imbalance and how is Telebras looking to address this?
By 2009, when we started the PNBL (Plano Nacional de Banda Larga – a government program to increase availability of internet access for consumers at an affordable price), the density was about 13 per cent. There are two main constraints that lead to this imbalance: the relatively low purchasing power of the population for broadband services and lack of network coverage, due to a lack of fixed access. When Telebras started its operations in July 2011 it addressed these problems by expanding coverage and lowering wholesale broadband prices, which strengthens ISPs in general. As a result, in 2012 Brazil had a 19 per cent broadband growth rate – the highest in the world, with more than 21 million of households connected.
Recently, Ibope/Nielsen released a report indicating that speed over 2Mbps grew 91 per cent between June 2011 and June 2012, from 8.8 million to 16.8 million connections. In the other hand, the number of connections with 512Kbps or less, decreased from 10 million to 6.1 million connections in the same period, a 39 per cent decrease.
The Broadband LATAM conference is taking place on 2 – 3 July 2013 at the Grand Hyatt, Sao Paulo, Brazil. Click here to download a brochure.
What impact will the upcoming Olympics have on your infrastructure and what specifically are you doing to prepare?
We are not providing services specifically to the Olympics but we are deploying a network to the World Confederations Cup 2013 and the World Cup 2014. This infrastructure will be used in the Olympics 2016 as well. By 2016 our backbone will be almost complete, providing coverage even to the metropolitan areas. As a result, many government and private customers will be using our services by then.
What is your strategy in terms of technology for the next couple of years?
We are now deploying an IP/MPLS/DWDM network and in the near future we are planning to deploy additional technologies as cloud computing, virtualisation and SDN – Software Defined Network. As our network grows nationwide, the need for more complex administration platforms grows as well, much faster and with a lot more complexity. In a SDN, Telebras will be able to shape traffic from a centralised console, without having to access each switch individually. Essentially, this technology will enable us to use less expensive switches and also have more control over the network traffic.
How do you balance making broadband affordable with the need to make CAPEX investments?
We are reducing our investments using existing dark fibres from other state-owned companies – OPGW (Optical Ground Wire), along with an extensive program of network sharing in partnership with other companies (private and public). As an example, we have made a cooperation contract with several cities to use their infrastructure, giving them broadband capacity in return. We are also making swaps with companies that have a network infrastructure in highways, railroads, pipelines and so on. As a result, we have a very cost-effective CAPEX. Furthermore the connection of sparse networks scattered all over the country adds value to both sides. It’s a win-win game.
What opportunities does the cloud present to operators?
The increase of out-of-the-company internet services (cloud services), as a global trend, tends to build up the overall operator’s market share. Most important, it can create diversity for a commodity like telecommunications. For instance, cloud services such as SaaS, cloud storage, VoD, and others have to be provided over a telecom network, which drives customers to consume more broadband. Besides that, it also generates a whole new set of products enabling up-selling (upgrades on contracted services) and cross-selling (selling of new services) with more added value to customers.
What is the most exciting development you expect to see in broadband over the next 12 months?
From an operator’s perspective, I would say the proliferation of SDN technology. This could make the network management and control less expensive; as well as simplify the development of new products and enable the quick provision of network connections. In general, SDN provides architecture flexibility and reduces direct and indirect costs.