Telecom, Media, and Technology Alert
2 July 2009
Authors:
Germany – New Frequency Auction Procedure
Dr. Tobias Bosch
tobias.bosch@klgates.com
+49.30.220.029.410
Dr. Friederike Gräfin von Brühl
friederike.bruehl@klgates.com
+49.30.220.029.411
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The German Federal State plans to hold its largest frequency auction ever, given the
bandwidth to be auctioned. On 12 June 2009, the Federal Council of Germany
adopted a new regulation on frequency assignments and thus paved the way for the
auction to be held, probably at the end of 2009 or in early 2010.
With regards to the bandwidth, the upcoming auction will be even larger than the
legendary UMTS frequency auction in 2000. Back then, more than 50 billion dollars
were paid for six frequency blocks. This time, the prices are expected to be
significantly lower due to the financial crisis and the decay of Internet euphoria.
However, experts still expect this auction to become the most important frequency
auction in Germany for the next ten years at least.
Part of this auction will in particular be the so-called digital dividend, which is an
interesting frequency band between MHz 790 and 862. Presently, this frequency is
mainly used for radio transmission and wireless microphones. By initiating the
auction, the German government intends to open the digital dividend for
telecommunication services. In particular, it aims at a nationwide fast Internet supply
in Germany, especially in rural areas. Further, frequencies in the range of 1710 to
1725 MHz, 1805 to 1820 as well as in the range of 1,8 GHz, 2 GHz and 2,6 GHz will
be auctioned. The frequencies are not reserved for specific technologies but the
auction will be technology neutral as long as the frequencies are used for wireless
telecommunications services.
A current draft of the BNetzA further specifies the general rules and conditions for
the auction procedure, in particular the conditions for a participation in the auction as
well as further technical details and restrictions applying to the different frequency
bands. According to this draft, the frequency assignments will be granted until 31
December 2025. Also, certain minimum bids for different paired and unpaired
frequency blocks are defined varying between EUR 1.25 million up to 3.55 million.
The draft can be commented on until 17 July 2009. BNetzA will then evaluate the
comments and issue a final decision. Thereafter, BNetzA will draft an additional
decision further detailing the specific auction rules, in particular the bidding process.
This draft can then, again, be commented on. Once both decisions are in place, the
frequencies can be auctioned.
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2 July 2009
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