Hong Kong’s communications regulator, Office of the Telecommunications Authority (OFTA) today invited applications for participating in an auction of mobile spectrum in the 850MHz, 900MHz and 2000MHz bands open to existing operators and new entrants. The watchdog says it aims to support investment in additional network capacity through the licensing of further radio bandwidth. OFTA’s statistics indicate that Hong Kong’s number of mobile users capable of gaining access to mobile data services doubled between December 2007 and July 2010 to 5.8 million, representing a population penetration rate of 82%. During the same period, the volume of mobile data usage increased 38 times from 32TB to 1,236TB.
The radio spectrum available in the auction is divided into four frequency bands, namely band A (832.5MHz–837.5MHz paired with 877.5MHz–882.5MHz; 10MHz in total), band B (885MHz–890MHz paired with 930MHz–935MHz; 10MHz in total), band C1 (2010.0MHz–2014.8MHz; 4.8MHz in total) and band C2 (2014.8MHz–2019.7MHz; 4.9MHz in total). OFTA has set the auction reserve price at HKD30 million (USD3.9 million) for each of the frequency bands A and B and HKD15 million for each of the bands C1 and C2. Applicants are permitted to bid for all four bands, which will be granted as 15-year unified carrier licences, stipulating that services must cover at least 50% of Hong Kong’s population within five years of granting. Additionally, the winner of band B will be allowed to use the frequencies only in base stations located outside those designated areas comprising country parks and specified remote areas (where frequencies have already been assigned to existing mobile network operators for improving their service coverage). In addition, part of the band B spectrum will be assigned on a shared basis with the railway operator(s) for the communications and control relating to cross-border railway operations.
OFTA will conduct an industry briefing for interested parties on 6 January 2011 and accept bidding applications on 31 January 2011 and 1 February 2011. The auction is scheduled to be held in February 2011, after the Chinese New Year. The Information Memorandum available on OFTA’s website (http://www.ofta.gov.hk/en/industry/850/im.pdf) sets out all details of the licensing framework.