Czech Republic concludes LTE spectrum auction, fails to usher in new entrants

The Czech Republic successfully concluded its second attempt to auction off spectrum for the construction of LTE networks, but the market will see no new entrants after both new applicants Revolution Mobile and Sazka Telecommunications decided against competing with the existing three players.

In a statement, the Czech Telecommunications Office (CTO or CTU in Czech) said although it had created the ideal conditions for the entry of a fourth operator, spectrum was eventually acquired only by the three existing players, T-Mobile Czech Republic, Telefónica Czech Republic and Vodafone Czech Republic, which will pay a combined 8.5 billion crowns ($418.8 million or €311.7 million) for their licences in the 800 MHz, 1800 MHz and 2.6 GHz bands.

The CTO had, for example, reserved a block of spectrum for a new entrant in a move that proved contentious among the incumbent operators. Nevertheless, the regulator said it had fulfilled its goal to allocate spectrum to allow operators to build LTE networks within a short period of time.

"Given the operators have been experimenting with LTE already, I gather that customers will be able to use really fast Internet on a mobile or tablet in a large part of the Czech Republic within one year," said CTO Chairman Jaromir Novak in a statement.

The CTO commented that the conditions of the LTE tender guarantee that the technology will not be deployed late as was the case with 3G, when operators launched services around eight or nine years after obtaining the frequencies. Some blocks of 1800 MHz and 2.6 GHz were not sold during the auction and the CTO said it is now considering ways of selling these frequencies.

Telefónica Czech Republic paid 2.8 billion crowns ($138 million or €103 million) for its received frequencies, including 2.4 billion for two blocks in the 800 MHz band. T-Mobile also won two 800 MHz blocks in that bandwidth, and will pay 2.6 billion crowns ($128.1 million or €95.3 million) for all of its frequencies. Vodafone received one block in the 800 MHz band for 2.7 billion crowns, and will pay 3.1 billion crowns ($152.7 million or €113.7 million) overall for frequencies.

Telefónica recently agreed to sell a 65.9 per cent stake in its Czech unit to PPF Group for €2.46 billion ($3.30 billion). PPF recently sold its mobile unit, PPF Mobile Services, to its CEO, Tomas Budnik. The subsidiary then changed its name to Revolution Mobile.

For more:
- see this Reuters article
- see this CTO release (translated via Google Translate)

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