New Zealand’s telecoms minister confirms details of 700MHz spectrum allocation options

23 May 2014

New Zealand’s Communications and Information Technology Minister Amy Adams has revealed details of the two sets of options that will be used for assigning spectrum in the 700MHz band to the three companies which won frequencies in last year’s auction. One set of options for assigning which frequencies will be assigned to each bidder will only be used if the Commerce Commission (ComCom) decides in favour of Telecom New Zealand’s purchase of 2×20MHz of spectrum.

As previously reported by CommsUpdate, in October 2013 2degrees, Telecom, and Vodafone New Zealand were named as the winning bidders in the state’s 700MHz spectrum auction. Telecom and Vodafone each successfully bid NZD66 million (USD54.5 million, plus goods and services tax [GST]) for 2×15MHz blocks, while 2degrees agreed to buy 2×10MHz spectrum blocks, paying NZD44 (plus GST). With the outcome of the sale having left a 2×5MHz block unsold, in January this year Telecom was confirmed as the successful bidder for this last lot, with a bid of NZD83 million. In the event that ComCom opts not to approve Telecom’s offer for the extra spectrum block on competition grounds, the other set of assignment options will be used, and an assignment auction round will be held ‘in the coming weeks’ once a decision on the matter has been made.

As per the first option, ComCom has said that Telecom will hold spectrum at one end of the 700MHz band, while the other two operators’ frequencies will be adjacent to one other; it claims this setup would allow 2degrees and Vodafone to develop commercial arrangements if they wish. Meanwhile, should Telecom not gain approval to acquire the extra 2×5MHz block, ComCom has said that the unsold lot will be placed between Telecom and Vodafone’s spectrum allocations. This, it said, would mean the state could fulfil its commitments under the auction rules by ensuring that it would be able to provide 2×20MHz of contiguous spectrum to Telecom or Vodafone, should either ultimately be successful in its clearance application for the 2×5MHz block.