New Perspectives on Auctions Latin American Spectrum Conference 2012 Mexico City, October 24, 2012 Erasmo Rojas Director Latin America & Caribbean 4G Americas

4G Americas Board of Governors 4G Americas will promote, facilitate and advocate for the deployment and adoption of the 3GPP family of mobile broadband technologies throughout the ecosystem – including networks, services, applications and wirelessly connected devices – in the Americas www.4gamericas.org

2012 White Papers WWW.4GAMERICAS.ORG Available for free download at www.4gamericas.org

2Q 2012 Top Wireless Markets in Latin America Average Latin America penetration: 95% voice and 16% data Subscriptions (M) Voice Penetration % Data Penetration % 104% 30% 266 M 74% 10% 94 M 121% 17% 57 M 46 M 93% 5% 8% 29 M 90% 28 M 91% 3% 26 M 119% 30% 16 M 102% 12% 15 M 86% 8% 10 M 92% 8% www.4GAmericas.org Source: Bank of America Merrill Lynch, Global Wireless Matrix 2Q2012

Mobile Broadband in Latin America Dec-2012 Dec-2016 4% 0% Mobile Broadband 5% 2% HSPA 18% LTE 43% GSM 78% 50% Others* *Otros = CDMA, TDMA, iDEN Dec 2012 (Estimate) Dec 2016 (Estimate) Total subscriptions 695 Million 842 Million Mobile Broadband 125 Million (18%) 460 Million (55%) Source: Informa Telecoms & Media WCIS+ Subscription Forecast, May 2012 www.4gamericas.org

Spectrum Caps in Latin America Country Cap value Comments Argentina 50 MHz Cap for aggregated value in 850 and 1.9 GHz bands Brazil 85 MHz and 40 MHz 85 MHz in 850 + 1.8GHz + 1.9/2.1 GHz bands and 40 MHz for 2.6 GHz band Chile 60 MHz and 40 MHz 60 MHz in 850 + 1.9 GHz + 1.7/2.1 GHz bands and 40 MHz for 2.6 GHz band Colombia 80 MHz and 30 MHz 80 MHz in 850 + 1.9 GHz + 1.7/2.1 GHz + 2.6 GHz bands and 30 MHz for new bands below 1 GHz (700 MHz) Ecuador 65 MHz Cap for aggregated value in 850 + 1.9 GHz bands Mexico 80 MHz Cap for aggregated value in 850 + 1.7/2.1 GHz + 1.9 GHz bands Peru 60 MHz and 40 MHz 60 MHz in 850+1.9 GHz bands and 40 MHz for 1.7/2.1 GHz www.4GAmericas.org

2Q12 Spectrum and Mobile Broadband adoption 16% average MBB penetration in Latin America Available market spectrum MBB penetration 524 MHz 28% 210 MHz 10% 110 MHz 11% 215 MHz 5% 170 MHz 5% 380 MHz 30% Fuente: Anuncios regulatorios, Informa Telecoms & Media, WCIS+, Agosto 2012 www.4gamericas.org

Current spectrum usage in Latin America & Caribbean 450 MHz Multiple uses: Rural, fixed, mobile telephony, public and private safety, point-to-point and point-to-multipoint distribution services 700 MHz Broadcasting services – TV Planned for TV broadcasting, fixed and mobile services 850/900/1800/1900/2100 MHz Mobile services 1700/2100 MHz In service in Mexico (August 2011) and auctioned in Chile in 2009 2500/2690 MHz TV and MMDS services Assigned to mobile services since 2010 3400/3600 MHz Fixed services Point-to-point and point-to-multipoint distribution services www.4GAmericas.org

More spectrum is key for the development of mobile broadband , but not any sort of spectrum… Key: Low frequencies for coverage (<1Ghz) Worldwide harmonization: economies of scale Band plans coordinated regionally More spectrum: 20 + 20 MHz carriers The efficient allocation of spectrum maximizes its value for the benefit of society www.4gamericas.org

Brazil Spectrum June 2012 auction: Raised US $ 1.26 B 14 MHz in 450 MHz + 140 MHz (FDD) and 35 MHz (TDD) in 2.6 G FDD winners: VIVO, Claro, TIM, Oi TDD winners: Sky, Sunrise Latest news: Government considering partial release of TV spectrum for 700 MHz and start auctioning 2H 2013 www.4GAmericas.org

Mexico Spectrum AWS: 30 MHz remaining on the shelf since July 2010 700 MHz: Government decided on APT band plan and auction in 2-3 years 2.6 GHz: Government planning to release 190 MHz from current holder (MVS) for MMDS services to mobile broadband services

Argentina Spectrum: No new spectrum released since 1999; only 850 MHz and 1900 MHz used Upcoming auctions: 850/1900 MHz auction cancelled and spectrum given to state operator AWS: 90 MHz; no information on upcoming auction www.4GAmericas.org

Colombia Spectrum: Government planning to auction 225 MHz 1H 2013 AWS: 90 MHz (new band) 2.6 GHz: 130 MHz (50 MHz auctioned in 2010) Latest news: Auction delayed from 2012 to 2013 due to political lobbying and plan to create an antimonopoly law 700 MHz 90 MHz would be auctioned in 2013. Administration chose APT channelization www.4GAmericas.org

Chile Spectrum 2.6 GHz 3 swaths of 20+20 MHz auctioned in July 2012; winners: Entel, Movistar and Claro 700 MHz 90 MHz would be auctioned in 2013. Administration chose APT channelization www.4GAmericas.org

Peru Spectrum 900 MHz Auctioned in August 2012 to Viettel (new entrant) that got also 1.9 GHz spectrum in January 2011; no services launched yet AWS Plans to auction 80 MHz ( 2 * 20+20 MHz) in 2013 www.4GAmericas.org

Spectrum auctions Latin America 2009 Chile auctioned 90 MHz 2010 Mexico auctioned 60 MHz 2011 Uruguay allocated 30 MHz 1.7/2.1 GHz (AWS) 2013 Colombia plans to auction 90 MHz Peru plans to auction 80 MHz Uruguay plans to auction 90 MHz Paraguay plans to auction 80 MHz www.4gamericas.org

Spectrum auctions Latin America 2010 Colombia auctioned 50 MHz (FDD) 2012 Brazil auctioned 190 MHz (FDD+TDD) Chile auctioned 120 MHz (FDD) 2013 Colombia plans to auction 130 MHz (FDD and TDD) 2.6 GHz 2013 Chile will auction 90 MHz Colombia will auction 90 MHz 700 MHz (Digital Dividend) www.4GAmericas.org

Opportunities in Latin America & Caribbean 111% mobile versus 20% fixed penetration provides a good opportunity for mobile broadband to reduce the digital divide Right choices of spectrum bands (700 MHz, 1.7/2.1 GHz, 2.6 GHz) for LTE could give significant economies the scale to the Americas Data ARPU could increase significantly from the current average of $ 14 USD with availability of cheaper smartphones and tablets Simple but efficient applications for e-government, e-health, e- leaning and e-commerce required by end users Streamline regulatory environment to promote mobile broadband investment and growth www.4GAmericas.org www.4GAmericas.org

Director Latin America & the Caribbean Thank you! Erasmo Rojas Director Latin America & the Caribbean www.4gamericas.org Erasmo.rojas@4gamericas.org