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Brazil launches 4G wireless service with few smartphone options

By Sérgio Spagnuolo

RIO DE JANEIRO (Reuters) - As Brazil rushes to introduce a blazing-fast fourth-generation wireless network before the 2014 World Cup, fewer than a dozen compatible smartphones will be available in stores, compared with the hundreds of models on sale worldwide.

And the phones will be operational in a just few cities at first.

The launch of 4G services is crucial for Brazil to modernize its thinly stretched telecommunications infrastructure and ease the burden on 3G networks, which currently support over 68 million data users, according to regulator Anatel.

But Brazilians venturing onto the new networks have to chose among a few pricey devices from companies such as BlackBerry, Samsung Electronics Co Ltd, LG Electronics Inc and Sony Mobile.

So far, 11 4G-enabled smartphones, all of them high-end devices, were approved by Anatel to operate in the country. That compared with over 260 devices worldwide with the technology.

Apple Inc's iPhone, one of the most coveted cell phones in Brazil, is not compatible with the 2.5 gigahertz frequency used for the country's current 4G network.

An auction for the broadcast frequency compatible with the iPhone 5 is not expected in Brazil until next year. Apple declined to comment on whether it plans to launch a compatible device in Brazil before then.

"4G is still recent in Brazil, so an avalanche of 4G smartphones is not expected," said Bruno Freitas, an analyst at technology research firm IDC.

Limited coverage is also an issue. According to auction rules for the 4G frequency, mobile operators are required to start offering the service only in the six cities that will hold soccer games during the Confederations Cup in June. Some companies started offering the service this week.

The host cities have a combined 18 million residents, less than one-tenth of the country's population.

By the end of the year, before the World Cup, carriers should extend 4G coverage to 12 of Brazil's largest and richest cities, with a population of more than 35 million people.

Brazil is expected to become the fifth largest smartphone market in 2013, behind China, the United States, the United Kingdom and Japan, according to IDC. It forecast 28 million new devices will be sold in the South American country this year.

Brazil's telecom industry expects sales of 4 million 4G devices, Anatel's president João Rezende recently told reporters.

SAMSUNG, BLACKBERRY TO OFFER PHONES

Electronics giant Samsung, whose Galaxy line is one of the best-selling handheld devices in the world, will launch four smartphone models in May and others later in the year, according to senior products manager Ricardo Araújo.

"We are still considering bringing in new products to the Brazilian market, but there is a very aggressive plan to increase the 4G portfolio in the second half of the year", he said.

BlackBerry also plans to launch up to four models compatible with Brazil's 4G network in 2013, two of which were already announced - the new touch-screen Z10 and the Q10 - country manager João Stricker said. Two other devices could share the new BlackBerry 10 platform, he said.

LG, which already has two 4G devices approved by Anatel, intends to launch its high-end smartphone Optimus G in Brazil in the next few weeks, as well as two or three other compatible models in the first half of the year, said Raphael Rocha, a manager for products and strategy in Brazil.

Sony Mobile, which already has one device ready to hit stores, intends to launch at least one new 4G smartphone soon, marketing director Ana Peretti said.

Google Inc's Motorola Mobility unit did not say if it will bring more smartphones to Brazil this year beyond its Razr HD model.

Nokia, which produces the Lumia line and has two 4G smartphones approved by Anatel, declined to comment.

(Editing by Brad Haynes, Walter Brandimarte and Jeffrey Benkoe)

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