France imposes caps for LTE spectrum auction

The French government announced that the telecoms regulator Arcep will open the bidding process for LTE spectrum by the end of this month, but operators will be limited as to how much spectrum they can bid for. France Telecom's rivals--including Vivendi's SFR, Bouygues Telecom and Iliad--had lobbied for the spectrum caps

The decision to impose caps was, according to the French government, to allow smaller operators to successfully acquire LTE frequencies and offer competition to the more established players. As reported by Reuters, Eric Besson, France's industry minister, said that the limit of 15MHz per operator would "protect effective and long-term competition to benefit consumers."

Dow Jones reported Besson as saying that the total 30MHz of spectrum to be auctioned would be split into four auction lots, but that one operator alone could not bid for more than 15MHz.

However, the move has been widely seen as a result of intense lobbying by France Telecom's rivals to stop the country's largest operator from gaining the bulk of the available LTE spectrum.

But this political manoeuvring might come to little given that the government has yet to set a minimum price for any of the LTE frequencies. While it is thought the authorities will want to gain €2 billion from the auction, Besson has requested two official agencies to make recommendations of where to set the entry price. If all goes according to plan, Arcep would like to issue LTE licences by the end of 2011.

For more:
- see this Reuters article
- see this Dow Jones Newswire article (sub. req.)

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