France reschedules its 5G spectrum auction for the end of September

France reschedules its 5G spectrum auction for the end of September

It has been announced that after a series of delays, France now expects to conduct its 5G spectrum auction at the end of September.

The auction was initially scheduled for January, but it was delayed as a result of disagreements between the French Ministry of Finance and the telecommunications regulator, Arcep, and then due to the coronavirus pandemic. According to Arcep, the auction is currently expected to be held in the last ten days of September, although the exact date is yet to be announced.

Wireless carriers use radio frequencies in order to develop networks which makes it an easy source of income for European countries, France included. Back in February, the four leading telecommunications operators in France – Orange, Iliad, Bouygues Telecom, and Altice Europe’s SFR – all submitted bid packages for some frequencies in fixed-price lots.

The government of France has stated that the entire 5G spectrum would have to bring in at least 2.17 billion euros ($2.47 billion), which is the bottom price that it is willing to accept for 310 MHz.

It has already agreed on a selling price of a 50 MHz bloc – it will cost each telecommunications operator 350 million euros, and will yield 1.4 billion euros in total.

The remaining 110 MHz will be sold in 10 MHz frequency blocs during the scheduled spectrum auction. The starting price is 70 million euros each, or 770 million euros in total.

The new proposed auction date will probably come as bad news for Bouygues Telecom, seeing as the operator has suggested a postponement until late 2020 or early 2021 due to uncertainties surrounding the global coronavirus outbreak. However, in light of these considerations, the requirement to launch 5G in at least two French cities by the end of 2020 was lifted.

Germany and Italy have made nearly 6.5 billion euros each from the sale of 5G spectrum which both shocked the industry and concerned the four leading operators in France whose margins have already been severely affected by the ongoing price war.

Maciej Biegajewski

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