MELBOURNE, Australia-The Australian government has raised just more than A$112 million (US$58.7 million) from the first of its third-generation (3G) spectrum auctions.
The auction, conducted by the Australian Communications Authority (ACA), was divided into two principal blocks: the first covered 13 areas based around major cities; the second block was divided into five regions nationwide.
Three carriers successfully bid for 482 lots of 3.4 GHz frequencies across Australia. The carriers are AKAL, Austar and Walker Wireless. AKAL obtained licenses wherever spectrum was available. Austar gained licenses in several states and the capital cities of Adelaide and Perth. Walker successfully bid in Melbourne, Sydney and Adelaide.
The spectrum access granted by the 15-year licenses is technology-neutral, tradeable and nonrenewable.
The spectrum can be used for a range of purposes, including much-vaunted 3G services and wireless local loop (WLL) offerings.
Six carriers initially contested the auction, which began on 3 October, although Telstra and AAPT withdrew early on. As an incumbent, Telstra was not permitted to bid in major cities and towns and was limited to 22 megahertz of spectrum in each of the regional spectrum blocks.
No auction participant could acquire more than 67.5 megahertz of the total bandwidth offered.
ACA Chairman Tony Shaw said he was delighted by the auction outcome. “The auction sees the entry of two new players in the deregulated Australian communications sector, which is good news for consumers,” he said.
The Australian business data market, which this spectrum is expected to cater to, is now worth more than A$5 billion (US$2.6 billion) a year, according to ACA, and is growing at a faster pace than the mobile market.
However, it is the 27 GHz auction, due to begin in November, that is likely to be more hotly contested by providers of broadband services.
“Broadband wireless offers a here-and-now solution,” Tom Motherwell, auction manager, told a recent broadband conference in Sydney. “Carriers don’t have to waste time in negotiation about access to the unbundled local loop.”
At press time, ACA had received two applications-one from Agility Networks and one from Thailand’s Shin Satellite Public Co.-for the allocation of licenses in the 27 GHz band. According to ACA, if sufficient bandwidth is available to meet the preferences of the applicants, it might allocate licenses for a predetermined price rather than going to auction. In February 1999, AAPT was allocated a license for A$66 million (US$34.6 million) to provide wireless broadband services in the adjacent 28 GHz band.
In handing down its budget in May, the Australian government pinned much of its surplus on estimated proceeds from the 27 GHz spectrum auction, which is expected to bring in A$2.6 billion (US$1.4 billion). This amount was revived 20-fold on original figures following the successful auction of licenses in the 1.8 GHz radio frequency band, which generated A$1.3 billion (US$681 million) earlier this year.
The 1.8 GHz spectrum auction was hailed as the year’s highlight in ACA’s annual report, released in October.
“The spectrum auction program has been the catalyst for the development of competition and new services, with significant returns to the Australian community for use of a valuable and scarce resource,” Shaw said at the time.
