BERLIN: Germany will be the first in Europe to put the low band up for sale. France is set to auction 700 MHz blocks later this year. The German telecoms regulator has opened a frequency auction, which marks the first sale of mobile spectrum in the 700 MHz band and could yield Germany about 4.5 billion euros ($5.1 billion).
The German Bundesnetzagentur said in a statement on its website that it plans to auction the 700 MHz blocks in May and June this year, along with the re-auction of frequencies in the 900 MHz and 1,800 MHz spectrum, which will expire in 2016.
The German regulator decided in 2013 to proceed with an early auction, despite opposition from cash-strapped operators in Europe’s biggest mobile market.
The operators argued a potentially expensive auction should be delayed because they needed financial firepower for investments in the roll-out of super-fast mobile networks, known as 4G or LTE.
The decision to go ahead with the sale of the low-band airwaves sparked a merger between the country’s two smaller operators Telefonica Deutschland and E-Plus, which at the time was owned by Dutch operator KPN (Amsterdam: KPN.AS – news) .
Proceeds of this year’s aution could be about 4.5 billion euros, according to Heike Pauls, a telecoms analyst at Commerzbank (Xetra: CBK100 – news) . Deutsche Telekom (Xetra: 555750 – news) and Vodafone could spend 1.6 billion each, while Telefonica Deutschland which operates in Germany under the O2 brand could spend 1.3 billion, she said.
But Pauls said that prices could easily go higher if Deutsche Telekom and Vodafone decide to aggresively defend their position against Telefonica which has become much stronger since the merger was closed last year.
The U.S. Federal Communications Commission said on Thursday it raised a record $44.9 billion in the auction of so-called AWS-3 airwaves, marking the highest point yet in the wireless industry’s appetite for more spectrum.
A 2012 auction of 4G wireless frequencies yielded 3.8 billion euros in the Netherlands, with prices so high that market leader KPN had to cut its dividend.
Telecom operators who want to participate in the auction can apply until March 6, the regulator said.
($1 = 0.8839 euros) (Reporting by Peter Maushagen and Harro ten Wolde; Editing by Elaine Hardcastle)
