CTU Sets Revised 4G Auctions in Mid-August

The Czech Telecommunication Office (CTU) hopes to launch its revised auction of fourth-generation mobile frequencies by mid-August, and is sticking to its plan to reserve spectrum for a new market entrant. Last month the watchdog confirmed it was sticking to its guns vis-a-vis the 4G auction, setting aside two blocks of 800MHz spectrum for a potential newcomer, as well as sticking with a plan to introduce a spectrum cap on all companies looking to purchase bandwidth (i.e. a maximum two blocks each in the 800MHz band) – which is seen as critical in the swift deployment of 4G services across the Czech Republic. The CTU’s revised auction follows the debacle of its cancelled tender in March this year, when bids rose three-fold on the reserve price of CZK7.4 billion (USD373.6 million) to exceed CZK20 billion, prompting fears that such high sums would hamper operators’ efforts to roll out 4G, leading them to seek to recoup investment costs by imposing higher charges on end users.

However, the Republic’s existing mobile operators – in particular Telefonica O2 CR – have openly criticized the CTU’s plans, arguing that they will be at a competitive disadvantage if the new entrant is allowed to pay less for its license. The fourth bidder in the auction is expected to be PPF Mobile Services, a unit of the PPF investment group owned by Czech businessman Petr Kellner.