Vesper Brazil
<< The Brazilian regulators' Vesper decision is curious. The Q had bought and paid for spectrum last September, I think, and it appears that Q's right to use it simply got yanked. >>
No. Not really. Qualcomm paid $84 million last year for C Block 1800 MHz SMP PCS spectrum (full mobility). Vesper was already licensed prior for WLL fixed mobility in 1900 MHz and under a relaxation of Anatel rules started offering "limited mobility" WLL in 1900 MHz about 15 months ago. They had skirmishes with Telesp about pushing the envelope of "limited mobility." They hoped to be able to offer full mobility in 1900 MHz and it appears that they hoped to do that without building out 1800 MHz. In addition and most importantly in order to be able to use full mobility on a "secondary" basis in 1900 MHz they had to remain in compliance with their original license obligations for the primary 1.9 GHz STFC-WLL) service, not simply replace it with full mobility.
While I hated to see a write off FQ2, Anatel's decisions may have been a blessing both medium and long haul for Qualcomm shareholders. Oi and TIM are going to be very tough competition on the GSM side and Telesp very tough competition on the CDMA side in Brazil. Had Vesper operated, any meaningful payback would have probably been way, way out, and I suspect Qualcomm was angling for a relatively quick sale to get out whole after establishing full mobility operations to begin with. Qualcomm's original plan announced in December 2001 was to divest Vesper within 12 months in its entirety to a strategic investor or as a spinoff, in which case Qualcomm shareholders would also become shareholders in Vesper (a la Leap).
- Eric -
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