Hong Kong 3G auction rings in $240m

Michael Carroll
04 Mar 2011

Hutchison and SmarTone emerged victorious from a 3G spectrum auction in Hong Kong, paying a combined HK$1.9 billion ($243 million) for 20MHz of spectrum.

The pair beat off competition from three other mobile operators and one fixed carrier to win the paired spectrum in the 850 and 900MHz bands, following four days of bidding. SmarTone bid HK$875 million for half the available spectrum, and Hutchison HK$1.077 billion for the remainder.

Regulator Ofta claims the auction of additional spectrum is necessary to match booming demand for mobile data in the city. Usage grew 189% year-on-year to 1.8TB in December, after the number of mobile data subscribers approached six million in mid-2010.

An Ofta spokesman said the additional spectrum will allow SmarTone and Hutchison to meet that growing demand by expanding their network capacity, and in turn boost the overall mobile market in Hong Kong.

SmarTone chief Douglas Li pledged a speedy expansion of the carrier’s network, having won spectrum in the 850MHz band. “Further network capacity expansion can also be effected at a lower cost at this lower frequency band,” he noted, adding that there are “plentiful” numbers of handsets compatible with the frequency.

The operators will be granted 15 year licenses for the spectrum, and be required to cover 50% of the population within five years.

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