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French wireless auction set for late May

05 мая 2011

France will open the auction of fourth-generation wireless frequencies to telecom operators in late May, capping the amount any single company can buy to protect competition.

Industry minister Eric Besson said on Wednesday the government would limit operators to 15 megahertz of 4G frequencies to "protect effective and long-term competition to benefit consumers".

France Telecom's rivals, including Vivendi's SFR, Bouygues, and Iliad, had lobbied for such caps to prevent the former state-owned monopoly from acquiring most of the 4G frequencies.

They said that without such caps it would be impossible for them to effectively compete with France Telecom in mobile internet services that have greatly expanded with the advent of smartphones like Apple's iPhone and tablet computers.

The proposed 15 megahertz cap could still, in theory, allow France Telecom to buy two of the four lots of 4G frequencies.

France is in the final stages of setting conditions for the auction of fourth-generation mobile spectrum, which will structure the competitive landscape of Europe's third-largest telecom market for years to come.

The government aims to collect at least 2 billion euros ($3.0 billion) from the auction.

Besson, speaking during a conference organised by telecom regulator ARCEP, said the government had asked two relevant agencies to submit analyses of where to set the minimum price.

The battle over spectrum is central to telecom operators' fortunes. As consumers use more smart phones and tablet computers, data capacity is being pushed to the limit, requiring operators to invest heavily to maintain strong networks.

An operator armed with more spectrum can offer customers faster download speeds and better reliability, and therefore command higher prices, industry experts say.

Those with less spectrum risk having weaker product offerings with lower download speeds than competitors and could eventually be pushed out of business or become takeover targets.

Other European countries, notably Britain and Spain, have placed limits on how much operators can buy to preserve competition.

Источник: Reuters

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