PTS in Sweden proceeds with the 700 MHz band auction

PTS in Sweden proceeds with the 700 MHz band auction

The Swedish Post and Telecom Authority (PTS) is ready to proceed with the 700 MHz auction after some struggling and iteration with the frequency plan and auction rules. According to PTS’s latest consultation in April 2018, the authority plans to make both FDD and SDL (supplemental downlink) available as follows:

FDD1: 713 – 718/768 – 773 MHz
FDD2: 718 – 723/773 – 778 MHz
FDD3-4: 723 – 733/778 – 788 MHz
SDL1-4: 738 – 758 MHz (4 x 1 x 5 MHz)

The original plan was to auction the band already in December 2016. However, due to increased turbulence in international politics the process was halted to re-consider amount of frequencies to be allocated to private mobile industry. Especially after the requests by the Swedish Civil Contingencies Agency (MSB) the amount of FDD spectrum was cut from 2 x 30 MHz to 2 x 20 MHz, i.e. 703 – 713/758 – 768 MHz was left out from the award. FDD1 and FDD2 are available as separate blocks of 2 x 5 MHz whereas FDD3 and FDD4 are to be awarded as one block of 2 x 10 MHz. In other words, there are not more than 3 FDD blocks available. This creates clear scarcity in a country with 4 big operators. Normally most players would like to secure a minimum of 2 x 10 MHz but in this case the band may become divided into smaller slices and/or some of the big ones may be left without any new FDD holdings.  FDD1 and FDD2 are to be awarded by an auction while the joint block FDD3-4 is to be awarded by a combination of an auction and a beauty contest. This block comes with coverage obligations in such a way that commitments to roll-out given by a candidate count, based on a specific formula, towards candidate’s offer in the selection process.

The reserve prices are set as follows:

FDD1 & FDD2: 100 MSEK each
FDD3-4: 200 MSEK
SDL1-4: 50 MSEK each

In the original auction plan PTS was to impose a spectrum cap of 2 x 20 MHz in FDD. In later versions PTS planned to impose no spectrum cap at all but now PTS proposes a cap of 40 MHz: The cap covers both FDD and SDL and enables a single player to buy a clear majority of all frequencies available. The licences are valid until end of 2040 and the auction is set to start on 4 December 2018.