China Mobile, CSL, Genius pay $193m for LTE spectrum

23 Jan 2009
Daily News

Four of Hong Kong's biggest telcos have paid HK$1.5 billion ($193 million) for three wireless broadband licenses.

Mobile operator CSL, China Mobile HK - the parent of cellco Peoples - and Genius Brand, a joint venture between PCCW and Hutchison, each bought 30MHz of spectrum.

Under the terms of licenses, the winners are required to provide a minimum coverage of 50% of population within five years.

The 15-year licenses are technology neutral, but the three winners are expected to deploy LTE technology, industry players said.

OFTA was selling 195 MHz of frequencies in the 2.3GHz and 2.5-2.6GHz bands, but only 90 MHz of spectrum in the 2.5-2.6GHz bands were sold. No bids were received for the Wimax-compatible 2.3GHz band.

The online auction finished January 22 after 56 rounds of bidding over nine days.

CSL paid $67.4 million for its spectrum, China Mobile Hong Kong $66.7 million and Genius Brand $64 million.

Two other bidders, broadband ISP Hong Kong Broadband Networks and mobile operator SmarTone-Vodafone, withdrew at the final stage.

SmarTone-Vodafone CEO Douglas Li said the company left the BWA auction at HK$453 million as that went beyond the maximum bid price the company set.

He said the operator could achieve a cost saving of HK$300 million by deploying LTE in the BWA spectrum, based on the incremental value of implementing LTE within the new spectrum and the savings made by returning excess 2G spectrum to the government.

"If I have to pay more than that price (HK$300 million), I will consider it a waste of money," Li said.

SmarTone-Vodafone would use part of its existing 2G spectrum in 1800MHz to implement LTE, Li said.

He said the company's existing spectrum was capable of supporting business growth with HSPA and HSPA+ for several years, even assuming robust growth in traffic and capacity requirements.

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