Spain: 5G Auction Continues To Be Delayed… And Falling In Price


T.C. | Yesterday it emerged that MásMóvil has asked the Ministry of Economic Affairs and the CNMC for the auction of the 700 MHz band frequencies to be used for 5G to take place after it has received the green light for its integration with Euskaltel. On the one hand, this is in order to have more “financial firepower.” And, on the other, to be able to coordinate with Euskaltel in the spectrum auction without it constituting an anti-competitive practice.

If the request is granted, the auction would be delayed even further than it already has been, as it was initially scheduled for June 2020, but the pandemic disrupted the plans. Subsequently, the government pledged to start the auction in the first quarter, but as of mid-May the tender documents have still not been published.

At the same time, it was leaked to the press that the price of the auction of 700 MHz frequencies for 5G was likely to be reduced. According to Bankinter analysts, “the reduction could be around 20% compared to the initial price of €1.17 billion”.

According to Bankinter “the initial price set, very similar to the final award price for the 800 MHz band in 2011, was excessively high in the current circumstances given the deterioration that operators have suffered in recent years in their profitability and solvency metrics. The price was also high compared to what is being paid in other countries for the deployment of 5G technology, which is key to their competitiveness. For example, in the UK operators have paid €325m for 20 MHz blocks of the 700 MHz band vs. an initial starting price of €400m here, despite the UK telecoms market’s turnover being twice that of Spain’s.”

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