Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Telecom pays $83 mln in winning bid for last 4G spectrum lot

Telecom pays $83 mln in winning bid for last 4G spectrum lot

By Paul McBeth

Jan 22 (BusinessDesk) - Telecom Corp, the country’s biggest telecommunications company, paid $83 million to win the final lot of 700 megahertz spectrum, flagged for fourth-generation mobile phone use.

The Auckland-based company secured the fourth 2x5 MHz lot, having spent $66 million on three lots of 2x15 MHz spectrum in the first auction, it said in a statement. Telecom and Vodafone were bidding for the final block of spectrum after Two Degrees Mobile bought two lots of 2x10 MHz lots during the first auction.

In effect, the deal sees Telecom paying close to a third more than its largest rival, Vodafone, for spectrum pairs, while locking out challenger brand 2Degrees, which sought a delay in sale of the last spectrum block in the current round.

“This fourth lot puts Telecom in the best position in the market to deliver a very high-performance 4G mobile network for New Zealand, including in less densely populated areas,” chief executive Simon Moutter said.

“This demonstrates Telecom’s absolute commitment to being the leader in mobile and data network capability and provides a strong foundation for Telecom to continue to deliver world class mobile and data services to New Zealanders across the country,” he said.

The winning bid means the government raised $259 million from the auction of the spectrum, which became available as a result of the switchover to digital television from analogue.

The government put a minimum reserve price of $198 million for the spectrum, something privately-held 2degrees said was a premium to the $157 million spent clearing the radio waves in the switchover of analogue television to digital and the $119 million valuation attributed to the spectrum by the Treasury.

While some 4G capability is already available on higher MHz spectrum, the 700MHz range is especially well-suited to pushing fast mobile broadband into rural areas because it requires fewer repeater stations to achieve coverage and into densely populated urban settings, such as commercial buildings.

As part of the auction’s conditions, the mobile phone operators will have to upgrade existing rural cell sites to 4G capability within five years and continue to expand their coverage. That’s to ensure at least 90 percent of the country has access to a 4G network within five years.

Shares in Telecom increased 0.2 percent to $2.39 today, and have gained 3.5 percent this year.

Both 2Degrees and Telecom had expressed concerns that the auction of a fourth round of spectrum would advantage deep-pocketed global player Vodafone.

Telecom’s purchase remains subject to clearance by the competition regulator, the Commerce Commission.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Land & Water Forum: Fourth Report On Water Management

The Land and Water Forum (LWF) today published its fourth report, outlining 60 new consensus recommendations for how New Zealand should improve its management of fresh water and calling on the Government to urgently adopt all of its recommendations from earlier reports. More>>



Welcome Home: Record High Migration Stokes 41-Year High Population Growth

New Zealand annual net migration hit a new high in October as more people arrived from than departed for Australia for the first time in more than 20 years. More>>


Citizens' Advice Bureau: Report Shows Desperate Housing Situation Throughout NZ

CAB's in-depth analysis of over 2000 client enquiries about emergency accommodation shows vulnerable families, pregnant women and children living in cars and garages, even after seeking assistance from the Ministry of Social Development and Housing New Zealand. More>>


Speaking For The Bees: Greens Call For Neonicotinoid Pesticide Ban

The National Government should ban the use of controversial pesticides called neonicotinoids after evidence has revealed that even at low doses they cause harm to bee populations, the Green Party said today. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news