Fiber Backhaul Grows in Brazil

Fiber Backhaul Grows in Brazil

Brazilian mobile operator Oi will have 76 percent of its backhaul over fiber and 24 percent over wireless by the end of this year. This represents a small change from the figures reported in December 2012, when Oi had 75 percent fiber and 25 percent wireless, but growth is more rapid among the competition. Vivo is expected to end the year with 15 percent of backhaul over fiber versus 13 percent in December 2012, TIM will grow from 13 percent fiber to 22 percent, and Claro will go from 39 percent in December 2012 to 46 percent by the end of 2013.

Tarifica’s Take

As landline calls and even home-based internet use decline in the face of a massive worldwide expansion in the use of mobile devices, there remain several areas of need that fixed line providers can fill. One of these is backhaul. The increasing reliance on fiber-optic cables for conveying mobile signals from core networks to smaller local networks is a golden opportunity for fixed line entities to stay vital and profitable.

This opportunity is by no means confined to Brazil. In the U.K., fixed line operators Virgin Media and BT have recently entered into agreements to construct free (or partially free) public Wi-Fi networks in the cities of Birmingham and Cardiff, respectively. While the direct revenue from these ventures may not be very great, one of the side benefits for the operators is the ability to sell some of the excess bandwidth to MNOs to help support their 3G and 4G networks. The relative growth of fiber backhaul over mobile backhaul reveals a hidden strength of fixed line networks and serves as a reminder that mobile and fixed are still very much mutually dependent.