3G Auction Reaches $804m On First Day

Telecommunications carriers have raised around $804.35 million at the close of trading on the first day of the Australian government’s auction for the third-generation radio spectrum (3G).

Following telecom New Zealand subsidiary AAPT’s decision to drop out yesterday, six carriers, including Hutchison Telecommunications Australia Limited, Optus, Telstra, Vodafone and 3G Investments are staking claims for spectrum they will then be able to use to supply 3G mobile phone services.

The telcos are competing for the 58 spectrum lots on offer with an aggregate reserve price of $1.08 billion, expecting 3G services to deliver bring high-speed wireless Internet access, video and CD-quality sound via mobile phone.

To date, Telstra is the biggest spender, bidding $221.3 million, followed by Optus and 3G Investments (both bidding about $185.5 million), Hutchison ($196.1 million) and Vodafone ($8 million),p>

The Australian Communications Authority (ACA), the body conducting the auction, has begun with two rounds of bidding each day from 9.00am to 11.00am and from 1.00pm to 3.00pm. The number of rounds per day would be increased to four, if necessary, as the auction progressed.

“The results of each round will be available to all bidders and to the public through the ACA website so it will be easy for anyone who is interested in the auction to follow its progress,” chairman Tony Shaw said.

“Detailed results on the site will show total bids made in the auction, the highest bids for each lot being auctioned, all bids lodged on all lots in the current round and the current position of each bidder.”

The structure of auction lots allows a bidder to bid for a ‘national’ licence, an ‘all-cities’ licence or for spectrum in individual cities or areas, with a single bid.

Licences are for 15 years from October 2002.

In last year’s Budget, the Federal Government abandoned its East Timor levy anticipating it would be able to offset that revenue by raising $2.6 billion from radio frequency spectrum auctions, withthe majority expected to come from the 3G sale.

However analysts have predicted the Government may receive $1 billion less than anticipated.

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