OFCA defends 3G reallocation plan

Dylan Bushell-Embling
10 Dec 2013
00:00
News
Daily News

Hong Kong regulator OFCA has defended its unpopular plan to take back and re-auction one third of mobile operators' 3G spectrum once their existing 3G licenses expire in 2016.

In a lengthy statement, the regulator dismissed the repeated arguments from CSL, PCCW-HKT, Hutchison and SmarTone that the decision will degrade service quality and negatively impact end-users.

OFCA said the operators will be free to apply to reacquire the spectrum through the planned auction, and if they choose not to take part they will have two years to adjust their networks to cope with losing the additional spectrum.

“On service quality, we would like to point out that there is currently ample capacity available in the 4G networks of the incumbent 3G operators,” an OFCA spokesperson added.

“If the incumbent 3G operators which are unable or choose not to acquire the re-auctioned Spectrum could use their 4G network capacity efficiently, they would be able to ensure that customer service quality would not be affected in any manner.”

Another argument operators have made in their objections to the proposed reallocation is that they would be forced to pass on their increased spectrum charges to consumers. But OFCA said the current spectrum utilization fee is only equivalent to about 0.5% of their annual operating costs.

“A total of eight spectrum auctions have been conducted since the assignment of the 3G Spectrum through auction in 2001, and so far we have not found any correlation between the spectrum prices as determined by auction and service charges,” the spokesperson added.

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