Brazil satellite stirs controversy as it awaits lift-off

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Friday, April 21, 2017

Grounded by a strike in French Guiana, Brazil's defense and communications geostationary satellite (SGDC), a project dating back to 2013, is facing stratospheric controversy.

State-telco Telebras, responsible for its operation, announced it will sell 70% of the satellite's capacity to telcos, while the remaining 30% will be used by the country's armed forces for communication purposes.

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According to the tender terms in discussion, four lots will be destined for national broadband coverage. Telebras will be retaining one of the lots itself and auctioning the other three.

Of these three lots, one will have 21Gbps capacity and the other two will have 12Gbps each. 

But the political opposition, along with civil society organizations, are threatening to appeal to the federal prosecutors' office and the audit court over what they deem a "privatization" of the SGDC.

They argue that President Michel Temer's administration is abandoning the public service function of the satellite program, and that after buying capacity in SGDC the telcos will benefit without meeting universal coverage goals or minimum sale price requirement.

But they also state their case based on technicalities, saying that the government's plan to use the satellite to increase broadband in the country's schools, especially remote ones, will be at risk.

The government plans to connect 80,000 schools with a minimum speed 2Mbps, according to a preliminary version of the national broadband program.

Even at those minimum speeds, Telebras' capacity of dedicated links allocated in the SGDC would be enough to serve only 7% of those schools, critics claim.

Initial plans called for a tender at end of March, but the terms are still in the public consultation phase. Not only is there no tentative date for the bidding process, but the courts could also step in at any time to halt the process.

SELLING CAPACITY

While controversial, it is not unheard of for governments to sell capacity on their satellites. Bolivia's first telecom satellite, Túpac Katari, is an example of that. At least six state-owned and private companies are making use of it, including Viva, a unit of Trilogy International; Entel Bolivia, and Millicom's Tigo subsidiary.

Túpac Katari was launched in December 2013 from China, which constructed and partially financed the project, and uses 70% of its capacity. The project reached the break-even point by end-2016, when it had generated US$52.5mn in revenue.

GROUNDED BY A STRIKE

Meanwhile, the SGDC has been grounded by a nearly month-long general strike in French Guiana, from where it is supposed to lift-off on a launcher provided by Arianespace. Access to the launching site has been blocked by protesters.

Maximiliano Martinhão, head of information policy at Brazil's science, technology, innovations and communication (MCTIC) ministry, and one of the authorities in charge of the SGDC project, told BNamericas that there is no date set for a launch until the strike in French Guiana is lifted.

In a recent interview with BNamericas, André Borges, head of telecom at the ministry, said that the delay does not imply any additional costs for Brazil.

(Pictured: An Arianespace Vega launcher carrying the Sentinel-2B satellite lifts off from Europe's Spaceport in Kourou, French Guiana, in March, right before the strike.)