Original URL: http://www.theregister.co.uk/2010/04/27/dutch_auction/
Netherlands raises €2.7m on 2.6GHz
Dutch auction not a Dutch auction
The Netherlands has raised just over €2.7m selling off its LTE-ready spectrum - a derisory sum, and no one seems to want WiMAX at all.
The auction has been running since Monday, and finished up with five companies buying FDD spectrum ideally suited to LTE deployments. Incumbents KPN, Vodafone and T-Mobile got 50MHz between them, while newcomers Ziggo 4 and Tele 2 snagged 80MHz of bandwidth. 69.7MHz of TDD spectrum, ideally suited to WiMAX, lies unsold.
The incumbents wanted more, and even went to court last week in an attempt to get the auction delayed while they lobbied to have the 55MHz cap on their combined bidding lifted, but without success as the government was keen to bring in at least two new entrants. Ziggo 4 is a pairing of two cable TV operators, Ziggo and UPC, which want to get into the mobile business, while Tele2 is already there but wants to get into the Netherlands.
The 130MHz sold is all paired spectrum - divided into non-contiguous blocks to enable one to be used for sending and the other for receiving - which is what LTE needs. The Dutch reserved the centre of the 2.6GHz band for TDD (time-division duplex) systems, of which WiMAX is the poster child, but are now considering the best way to get shot of the block no one seems to want.
Not that bidders were clamouring to get hold of the rest of the spectrum – Finland raised €3.8m for its 2.6GHz, though €1.47m of that was for the TDD licence, so cutting that out the revenue generated by both countries was about the same, despite Finland having only a third of the population.
The Netherlands did restrict existing operators to 55MHz, which will have depressed the price, and there’s a licence requirement to roll out within two years so bidders will have had to keep some cash back for that. But mostly the price paid is indicative of operators being reluctant to splash out on radio spectrum when no one knows quite what it’s for or thus how to make money out of it. None of this bodes well for Ofcom's super-auction next year. ®