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By Clara-Laeila Laudette
MADRID, May 31 (Reuters) - Spain softened conditions and cut
prices in its upcoming radio frequency auction by 15% for the
core 700 megahertz band vital for next generation 5G mobile data
services, drawing a welcome from debt-laden telecoms groups
likely to bid for spectrum.
Seeking to incentivise participation, the government cut
prices by 12.5% to 20% from last year, depending on the band.
"The conditions are still demanding, and the prices could
have been lower, but we recognise and thank the government's
efforts in improving conditions," said a spokeswoman for Spain's
DigitalEs association, which represents the four largest mobile
and broadband operators.
She said the terms balanced the state's need to boost
revenues with a recognition of the sector's debt levels and
importance to economic development.
The government also eased conditions for deploying services
across the newly-allotted blocks, extending the deadline for
rolling out coverage by a year and specifying exactly where
operators must prioritise services.
"We wanted to make it very clear which places need to be
covered (by 5G networks) - the previous coverage criteria were
very broad and left a lot up to the companies," a spokeswoman
for Spain's telecommunications and digital infrastructure
department told Reuters.
Any obligation to grant third-party operators access to the
infrastructure has disappeared from the conditions, a move which
may draw attention from regulators in Brussels and Madrid - and
smaller companies like MasMovil and Euskaltel which
have relied on network-sharing agreements.
Neither MasMovil nor Euskaltel - currently in merger talks
to create Spain's fourth-largest operator - were immediately
available for comment.
As a further sweetener, the government said in April it
would double the length of frequency concessions to 40 years,
which operators cheered as providing greater visibility.
Orange - which this month announced it would lay
off 485 employees to cope with Spain's highly fragmented,
competitive market - declined to comment, while Vodafone said it
was still studying the auction's terms.
"We wanted around 20% off the starting prices of every
tranche," one source within the sector told Reuters. "But the
overall formula is reasonable, with the extended compliance
period and doubled amortisation time."
Spain has prioritised the development of 5G mobile data in
its post-pandemic recovery strategy, earmarking nearly 30% of
the 140 billion euros ($171 billion) it will receive in EU funds
to a digitalisation plan.
Applications to participate in the auction are due by July
2, with the auction to be held before July 21.
($1 = 0.8201 euros)
(Reporting by Clara-Laeila Laudette
Additional reporting by Nathan Allen
Editing by Mark Potter)
