Vodafone offers AUD571.8m for vacant 700MHz spectrum

10 May 2016

Vodafone Hutchison Australia (VHA) has requested permission from the government to acquire 2×10MHz blocks of 700MHz spectrum that went unsold in an auction held by the Australian Communications and Media Authority (ACMA) back in 2013. If accepted, VHA’s proposal would see the ACMA either charge the telco an upfront fee of AUD571.81 million (USD420.03 million), or allow it to pay via three instalments over the period 2018-2020. The latter option would see VHA pay AUD274.5 million on 31 January 2018, AUD159.9 million on 31 January 2019 and AUD159.9 million on 31 January 2020, for a total of AUD594.3 million.

The cellco’s chief strategy officer Dan Lloyd told ZDNet: ‘For several years, 15MHz of 700MHz spectrum has been lying unutilised. Vodafone recently put forward a proposal to acquire some of this spectrum. Our proposal is a win-win for competition and for government, as we have offered to pay the same effective price for the spectrum as the price paid in the 2013 auction. The Australian government would be fairly compensated for the spectrum at the market price, while customers in regional and rural areas would benefit from increased competition, as it would allow us to extend coverage into these areas.’

According to TeleGeography’s GlobalComms Database, Telstra purchased 2×20MHz blocks of 700MHz spectrum in the 2013 auction, and Optus acquired 2×10MHz. The remaining 2×15MHz of ‘digital dividend’ spectrum remained unsold, after VHA opted not to participate in the process.