Government prepares to auction off more spectrum

The federal government is preparing to sell spectrum in the 1800MHz, 2GHz, 2.3GHz and 3.4GHz bands that failed to sell at previous auctions.

Communications minister Senator Mitch Fifield announced today that the government would scrap previous allocation limits in the 2GHz band, allowing all Australia’s telcos to bid for the spectrum. Limits will be retained in the 1800MHz band (no allocation limits apply in the 2.3GHz and 3.4GHZ bands).

The decision on spectrum allocation limits was in line with advice from the Australian Competition and Consumer Commission.

“While spectrum is an essential input into mobile services, the relevant holdings are dispersed and the amount of spectrum available is not significant,” the ACCC said in its advice to the government. 

The existing limits in the 1800MHz band — which largely rule out Telstra or Optus picking up more spectrum in the band — promote competition, the ACCC said.  

“The ACCC considers current allocation limits in the 1800 MHz band are sufficient to promote competition as they would allow VHA or TPG to acquire spectrum in the Mackay area where they currently do not have any spectrum holdings in the 1800 MHz band,” the ACCC said.

“We also consider that Telstra and Optus hold sufficient spectrum in the 1800 MHz band such that each company is unlikely to be constrained in the mobile broadband market if they did not acquire further 1800 MHz spectrum in the omnibus spectrum auction.”

Telstra and Optus between them picked up the majority of regional spectrum on offer in the 2016 auction of 1800MHz spectrum.  

A single auction will be conducted for all of the residual spectrum later this year. The auction will be conducted by the Australian Communications and Media Authority.  

Selling the residual spectrum will make for a smoother transition to the government’s proposed new spectrum licensing framework, the government said.

In May government launched a consultation on reforms that it says will modernise and simplify Australia’s spectrum management framework, including an exposure draft of the Radiocommunications Bill 2017.

Fifield has said that spectrum reform will help boost the rollout of 5G services in Australia.