Telecom Lead America: Nokia Siemens Networks is
strengthening its presence in Brazil.
The mobile broadband equipment player has tied up with
contract manufacturer Flextronics International to set up its assembly facility
in Brazil.
The presence in Brazil is significant for Nokia Siemens
Networks as telecom operators in Brazil will be gearing up for launching 4G LTE
services soon.
The plant will begin shipping 4G wireless equipment at
the start of October. Local carriers will be deploying 4G networks targeting
the 2014 World Cup.
Ken Wirth, head of the Americas region for Nokia Siemens,
said manufacturing capacity close to the markets will lower transport costs,
tariffs and any other things that pop up.
According to media reports, Brazil issued 4G broadcast
licenses in June stipulating at least 60 percent Brazilian content in the
hardware installed, a requirement challenged by the United States and the
European Union at the World Trade Organization.
For Nokia Siemens, the demand from four Brazilian
operators starting up their 4G networks will be enough to justify the local
manufacturing capacity for the next 12 to 18 months, Wirth said, after which
the Brazil plant could supply the region.
The company has already signed 4G contracts with a
Brazilian carrier and a Chilean carrier.
Brazil’s 4G networks will offer better opportunities for
Nokia Siemens to grow its share of the Latin American market from about
one-third. The region contributes 13 percent of the company’s revenue — more
than North America — and is growing fast.
In Brazil, wireless carriers have earmarked some $1.5 billion
in capital expenditures for next year, with about 30 percent dedicated to 4G
technology. Operators have committed to minimum investments in their 4G
networks to cover host cities for the Confederations Cup in 2013.
Nokia Siemens aims to start installing small cell units
in the U.S. and Japan by the end of 2013, expecting carriers there to soon
devote 70 percent of capital spending to the technology.
