Mobile spectrum auctions may see the government trying to cash in

A recent request for tender looking for a valuation of its assets in the mobile spectrum in the run up to the spectrum auctions has been released by the Federal Government.

In order to put a dollar value on the 15-year spectrum licenses in the 800 MHz, 1.8 GHz, 2.1 GHz, 2.3 GHz, 3.4 GHz, 20 GHz, 27 GHz, 28 GHz, 30 GHz and 31 GHz bands, the tender has requested that the telecoms regulator ACMA and the Department of Broadband, Communications and the Digital Economy (DBCDE) are assisted by a third party company.

The valuing of bands that are used the most for mobile broadband services in Australia, which are the 800 MHz, 1.8 GHz, 2.1 GHz, 2.3 GHz and 3.4 GHz bands, will be the main area of focus of the tender said a spokesperson for DBCDE.

A view to how much money may be obtained from the new auction, pending the end of the 15-year licenses which were auctioned between 1999 and 2001, is expected to be given to the Federal Government by the valuation.

The tender document states “Value means the amount of money buyers may be prepared to pay the government to purchase the spectrum when it becomes available.”

A range of “scenarios” ranging from “the reallocation of licenses through an auction process to the renewal of licenses held by incumbents” is to be presented to the DBCDE at its request.

It is also stated in the tender document “Associated issues, such as disruption costs that could result from an auction (because of the potential for new licensees and service discontinuity) will also need to be assessed.”

It was during the highly expensive auctions that took place between 1999 and 2001 that most of the mobile telephony spectrum bands being valued were licensed.

The Federal Government earned around $1.16 billion from the auction of 15-year licenses in the 2 GHz band, which were allocated for 3G mobile service, to a number of mobile carriers back in 2001. October 2017 is the expiry date set for these licenses.

In 1998 the 800MHz and 1.8 GHz bands, which are also being used for mobile telephony, were also auctioned for around $250 million and by 2013 will be available for auction again.

Source – ITNews.com.au