OFCA raises $312m in spectrum auction

Dylan Bushell-Embling
10 Dec 2014

Hong Kong's Office of the Communications Authority has raised HK$2.42 billion ($312.1 million) through an auction of mobile spectrum to China Mobile Hong Kong, SmarTone and Hutchison Telephone Company Limited (HTCL).

The three operators acquired a combined 49.2 MHz of spectrum from the 1.9-GHz to 2.2-GHz bands.

The spectrum is being assigned as part of the government's hybrid approach to reallocating the 3G spectrum held by Hong Kong's four 3G operators - HKT, CSL, HTCL and SmarTone - once their existing licenses expire in October 2016.

This model involved reallocating two thirds of operators' existing spectrum automatically and auctioning the remaining third, in part to give China Mobile Hong Kong the opportunity to acquire its own 3G license.

China Mobile Hong Kong bid HK$970 million for 19.6-MHz of spectrum via two paired blocks, SmarTone bid HK$980 million for 19.8-MHz and HTCL paid HK$470.4 million for 9.8-MHz.

Operators had expressed concern in the run-up to the auction that the reallocation will impact quality of service for their existing 3G networks, but the results suggest that they'll have adequate spectrum to maintain the user experience.

Once the new spectrum is assigned in October 2016, HTCL will be reassigned its existing spectrum holding of 29.6 MHz, SmarTone will hold a total of 39.6 MHz – 10 MHz over what it holds today – and China Mobile Hong Kong will have its 19.6 MHz.

HKT has meanwhile acquired by CSL New World Mobility in a $2.45 billion deal. As part of receiving regulatory approval for the acquisition, CSL had to agree not to participate in the auction.

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