Saturday, 20 October 2018

Austria sets date for 5G auction, sale will not be a cash cow

By Mary Lennighan, for Total Telecom
Wednesday 19 September 18

3.4 GHz-3.8 GHz sale due to start in February; licences will be sold regionally, with spectrum caps, and reserve prices will total just €30 million

Austria's upcoming auction of 5G spectrum will not be a repeat of its 4G frequency sale, which drew strong criticism for the amount of money it raised, the country's telecom regulator insisted on Wednesday. "This time we have done a lot differently," said Johannes Gungl, head of the telecommunications and postal services division at the Austrian Regulatory Authority for Broadcasting and Telecommunications (RTR)…

Austria's upcoming auction of 5G spectrum will not be a repeat of its 4G frequency sale, which drew strong criticism for the amount of money it raised, the country's telecom regulator insisted on Wednesday.

"This time we have done a lot differently," said Johannes Gungl, head of the telecommunications and postal services division at the Austrian Regulatory Authority for Broadcasting and Telecommunications (RTR), on Wednesday.

"The auction of this 5G pioneer band is not comparable to the last multi-band auction," he said, adding that the aim of the sale is to create the best conditions for 5G in Austria.

Austria sold off spectrum in the 800 MHz, 900 MHz and 1800 MHz bands in October 2013, raising €2.01 billion for government coffers. Spectrum winners Telekom Austria, T-Mobile and 3 were vocal in their criticism of the auction and the exorbitant sums they felt they had been compelled to spend.

Austria's 5G spectrum sale - which will take place in the first quarter of 2019, Gungel announced on Wednesday – will have much lower reserve prices applied to the airwaves.

The country will sell off frequencies in the 3.4 GHz-3.8 GHz band with a total minimum bid price of €30 million. That compares with the eye-watering €530 million combined reserve price in the 2013 auction.

"We do not expect a result as in the previous auction," Gungl said. "We set the minimum bids very carefully."

Austria's 5G licences will be awarded on a regional basis, 12 in all, with a view to giving local broadband providers the opportunity to enter the market for high-speed mobile Internet, the regulator said. A total of 390 MHz of spectrum is available in each region and licences will be valid until the end of 2039.

The regulator will also impose spectrum caps, at least initially. In the first phase of the auction, Telekom Austria's A1 and T-Mobile will be able to acquire a maximum of 150 MHz each, with all other players restricted to 170 MHz. However, the restrictions will be eased in phase two of the auction, if unsold spectrum remains, with A1 capped at 160 MHz and all other players at 190 MHz.

Certain rollout obligations will be applied, varying by region and spectrum band.

The auction is due to start in February. Would-be participants have at least two months until the deadline for applications, the regulator said.

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