French LTE auction bids garner €936M, set European price benchmark

All four French operators have been granted licences for LTE spectrum in the 2.6GHz band following bids totalling €936 million, setting a new high-water benchmark in Europe in terms of the bid price per MHz per resident.

The French government welcomed the outcome of this first auction, which had a reserve price, or minimum bid, of €700 million, while also granting licences to all four operators. Prior to the auction, Bouygues Telecom and Iliad had lobbied to stop France Telecom (FT) Orange and SFR from dominating the bidding and becoming the principal spectrum holders.

FT Orange and Iliad made the highest bids, paying €287 million and €271 million respectively for 20MHz blocks, with both agreeing with the telecoms regulator, Arcep, that they will host MVNOs on these new frequencies.

Bouygues Telecom bid €228 million in exchange for a 15MHz block and agreed to host MVNOs, while SFR, the country's second largest operator, also secured a 15MHz holding by only offering €150 million with no MVNO support.

All four operators are expected to make bids in the next LTE spectrum auction set to start in December for the more valuable 800MHz spectrum. The government has set a minimum level of €1.8 billion for this next round, having previously set a target price of €2.5 billion for the entire auction, a number that now looks likely to be easily exceeded.

The prices obtained by the French government for the 2.6GHz spectrum have established a new highpoint in Europe, with the auction effectively earning 10 euro cents per MHz per resident. This compares to Spain's auction of the same frequencies that earned an average price of 2.7 euro cents per MHz per resident, and Germany's 2.2 euro cents, according to figures given by Arcep.

For more:
- see this Reuters article
- see this Dow Jones Newswire article

Related Articles:
Report: Free Mobile files complaint over French LTE auction rules
France increases LTE auction reserve, prioritises rural coverage
Spanish LTE auction dominated by FT Orange, Telefónica and Vodafone
Germany's regulator gives go-ahead for more 800 MHz LTE deployments
Italian LTE auction attracts £2.3B in opening bids

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