Czech regulator plans second auction attempt in November

The Czech Telecommunication Office, or CTO, said it will make a second attempt to auction spectrum for LTE services later this year, but its proposal to reserve spectrum for a fourth operator has already sparked protests among the three existing operators and it is not clear whether they will take part.

After its first auction attempt was aborted in March over concerns that bids were too high, the CTO (known as the CTU in the Czech Republic) said this week it would invite bids for frequencies in the 800 MHz, 1800 MHz and 2.6 GHz bands, with all entries to be received by the end of September. Reuters reported that the auction would be carried out by mid-November, while the CTU said the licences should be granted at the start of 2014.

According to Bloomberg, CTU said it wants to raise at least 8.72 billion koruna (€338 million or $450 million) in the auction.

The CTO revealed the new conditions for the spectrum auction in April, but Vodafone CZ, T-Mobile CZ and Telefónica CZ opposed the plan to reserve a 2x10 MHz block in the 800 MHz band and a 2x15.8 MHz block in the 1800 MHz block for a new player.

Apparently undeterred by the protests, the CTO this week confirmed that it will press ahead with its plan to create the conditions for a fourth operator to enter the market.

"The objectives of the auction are clear," said Jaromir Novak, chairman of the CTO board, in a statement. "We strive to develop new services, mobile broadband Internet access, encourage competition, create the conditions for the entry of another operator with nationwide operations and ensure efficient use of spectrum."

It's unclear what actions the three existing operators will take. According to Reuters, T-Mobile CZ again protested against the plan to reserve spectrum and said it considered this step to be "an unjustified disadvantage for existing operators."

"We will decide whether we will take part in the auction after a detailed examination of the materials. We are considering possible legal steps," T-Mobile spokeswoman Martina Kemrova told Reuters.

It's also not clear who the fourth operator might be; Czech financial group PPF is said to have taken part in the first auction attempt and is expected to take part in the new auction.

Analysts suggest that the three operators have had things their own way for too long, and that a fourth operator will help shake up competition.

"The auction will be a milestone for a Czech telco market," Cyrrus AS analyst Tomas Mencik told Bloomberg "After years, it may bring a new competition to the country and that's not what the current players are used to."

For more:
- see this Reuters article
- see this Bloomberg article

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