Teles want BNDES financing to leverage 5G in companies

Telephone operators advocate that the BNDES (National Bank for Economic and Social Development) create special lines to finance companies interested in modernizing their production system with 5G telephone technology – the so-called 4.0 industry.

Today, only large groups, mainly from industry and agribusiness, test the fifth generation. In automakers, which already have a high level of automation, 5G will make supply chains more integrated, adjusting production to the number of orders in the market – which would avoid overcrowding in the yards.

In the field, for example, large companies such as Bom Futuro and SLC Agrícola have already connected the machinery via the high-speed internet network to exchange information, in real time, on pests, weather and soil conditions, as well as consumption of inputs. . This was done through the installation of exclusive infrastructure by operators for these companies.

The evaluation is that this allows to improve results and reduce production costs.

This business model proved to be viable for telecoms, as it allows them to bypass the queue of the 5G coverage schedule defined by Anatel (National Telecommunications Agency), which provides, in the first place, for connection in cities with more than 500,000 inhabitants .

In the interior of the country and in areas far from urban centers, telecoms close partnership contracts through which they own the antennas, but all investment in the work and equipment is paid by the customer.

The operators believe that, in order to accelerate this expansion, the BNDES —under the new mandate of Luiz Inácio Lula da Silva (PT)— should finance such projects. They argue that 5G technology is primarily a tool for the corporate market.

For consumers in general, the fifth generation will only make a significant difference when the new crop of applications hit the market – such as telemedicine, distance education or augmented reality. Until then, the perception of the service will only be a slightly faster connection for users.

Officially, the telecoms have not yet discussed the matter with the future president of the BNDES, Aloizio Mercadante.

They wait for the beginning of the government to proceed with the election. They say they want to take advantage of the opportunity, since Lula delegated to Mercadante the task of using the BNDES to promote the country’s reindustrialization, and 5G would be one of the ways to modernize industrial plants.

For Marcos Ferrari, president of Conexis, an association that has represented operators since 2013, the country is experiencing economic stagnation with a loss of competitiveness —with the exception of agribusiness. “The fifth generation can be a decisive element for the productive modernization, but the sectors do not have incentives to adopt it”, says Ferrari.

“The New Doctor [Ministério do Desenvolvimento, Indústria, Comércio e Serviços] can create a policy to encourage productive digitization and the BNDES, incentive lines for modernization.”

Projections made by Omdia, a consultancy specializing in telecommunications, indicate that Brazil’s GDP (Gross Domestic Product) could increase by US$ 1.2 trillion (R$ 6.3 trillion) by 2030, if the technology is fully implemented in the country.

By sectors, this increase in GDP should be greater in the areas of technology (R$ 1.3 trillion), government and manufacturing (R$ 1 trillion each), services (R$ 800 billion), retail (R$ 465 billion), agriculture (BRL 407 billion) and mining (BRL 257 billion).

Final costumer

For consumers, the forecast is that 5G will be working in about 50 cities with more than 500 thousand inhabitants by the end of January 2023. Anatel has already given the green light for telecoms to install the infrastructure for commercial exploitation. Together, these municipalities account for 32% of the national population.

With almost a third of the population covered by the signal, the device industry is already gaining scale to bring more models, especially those that communicate with the most modern 5G networks.

Until the end of 2022, there were obstacles for large manufacturers – such as Apple, Nokia, Samsung and Ericsson – to market devices capable of operating on the standalone 5G network – the so-called pure 5G. Apple only released the iPhone software update for the standalone system in November.

While the popularization of 5G phones does not occur, operators are providing the service through non-standalone 5G, which works at 5G speed, but with a response time greater than 1 millisecond between the antenna and the devices.

Technically, 5G only works to its fullest in “pure” networks. However, this infrastructure requires much more investment.

To guarantee this standard, operators need to install up to ten times more 5G antennas to maintain coverage at very high speeds (up to ten times faster than 4G).

Although federal legislation has facilitated the construction of these networks in cities, many municipalities still resist the modernization of their local laws. The waiting time in some capitals, according to operators, exceeds four months. There are cases in which the city hall analyzes the request for installation of antennas for more than a year.