Netia trumps Hutch for 3G licence, but problems remain

10 May 2005

Poland’s industry watchdog the Telecommunications and Postal Regulatory Office (URTiP) has awarded an additional UMTS licence to Netia Mobile, a subsidiary of the country’s second largest fixed line operator Netia Holdings, but rejected all bids for the GSM-1800 spectrum which it auctioned concurrently. Netia Mobile bid for the 3G frequencies on offer as part of a consortium with Novator Telecom Poland, owned by Novator One LP. It beat off a rival bid from Hutchison Whampoa, which took part via the investment fund Qiana Investment. Hutch was widely tipped to win the auction that also included bids from domestic mobile operators Polska Telefonia Cyfrowa (PTC) and TP SA’s mobile arm Centertel. Netia Mobile offered PLN345.05 million for the concession, ahead of Hutch which offered just PLN103.9 million. Whampoa’s lower bid is seen by many as an indication that the Hong Kong firm doesn’t expect great things from the Polish market.

URTiP said that it had rejected all bids for GSM-1800 frequency on the grounds that none of the applications met the minimum terms of the tender. The participants in this process had included Polkomtel, Netia Mobile and Centertel; Hutch did not participate in the 2G auction. The regulator had launched the tenders for 3G/GSM frequency on 22 February with the aim of creating a fourth player to galvanise growth in the relatively underdeveloped mobile market, but these plans now look less certain. Indeed, within hours of receiving its UMTS award Netia Mobile said it may return the 3G licence after its failure to secure a 2G concession. Its CEO Wojciech Madalski said the company’s business plan was built on the premise of it also owning and operating a conventional GSM network and that, though it could reapply for the licence or decide to run its business with just the one licence, it would need to review its options before planning its next action.

Poland, CK Hutchison, Netia