Australian 3G Auction Rules Emphasize Competition

Australia's government Thursday announced rules for the country's forthcoming 3G (third-generation) mobile phone spectrum auction designed to ensure that there will be at least four competing operators offering 3G services in urban areas and two competitors in rural areas.

The auction, to be held in the first half of 2001, will therefore maximize the potential benefits to consumers, according to a statement issued Thursday by Richard Alston, Australia's minister for communications, information technology and the arts. The competitive environment will mean a faster rollout of 3G mobile services and their availability at the cheapest possible price, Alston said.

In metropolitan areas where the government has re-allocated 2x60MHz of paired spectrum and 20MHz of unpaired spectrum in the 2GHz band, no operator will be able to acquire more than 2x15MHz of paired spectrum and 5MHz of unpaired spectrum, which will allow a minimum of four competitors in metropolitan areas.

In regional areas, where the government has re-allocated 2x20MHz of paired spectrum in the 2GHz band, no operator will be able to acquire more than 2x10MHz of paired spectrum. This will allow a minimum of two competitors in regional areas, according to the statement.

Australia's 3G auction is unlikely to yield anything near the $2.6 billion that the government was originally hoping for. A general lack of interest means that A$1 billion is a more likely figure, analysts said earlier this month.

The government had previously said that the auction would be held in late January. The Australian Communications Authority (ACA) will run the auction and will shortly call for applicants to participate in the auction, Alston said in the statement.

More information about the auction can be found on the ACA's Web site at http://203.37.2.230/3GWG/3rdGenWG.htm/.

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