Norway communications ministry auctions 450 MHz band spectrum licence

The Norwegian Ministry of Transport and Communications and the Post and Telecommunications Authority are inviting interested parties to participate in an auction of a spectrum licence in the 450 MHz band.

The Norwegian Ministry of Transport and Communications and the Post and Telecommunications Authority are inviting interested parties to participate in an auction of a spectrum licence in the 450 MHz band.

This frequency band is suitable for delivering digital mobile telephony, but the auction rules are structured in such a way that the winning bidder is free to develop services of its own choice.

The 450 MHz frequency band will be available as of 1 January, 2005, and the spectrum licence will be valid for a period of 15 years.

The procedure will be a sealed, first-price auction. Each participant in the auction may submit only a single bid. The highest bidder wins, and the winner will have to pay the amount of its bid.

A frequency fee of €120,000 (NOK 1m) must be paid per MHz (duplex) of bandwidth, with a minimum of €540,000 (NOK 4.5m) for the first year. This amount is determined by the Norwegian Parliament for the year 2005, but the amount could change in subsequent years, given that it is the Parliament that determines the frequency fees.

In addition, an annual frequency administration fee must be paid to the Norwegian Post and Telecommunications Authority, which is estimated to be €91,000(NOK 750,000) for the first year.

Bidders will have to keep in mind that these payments only cover the frequency-related fees. Any service provider will have to pay additional administrative fees for the provision of services over the network (registration as a service provider). These fees are comparatively low.

The licence obligations encompass a geographical coverage obligation of at least 16,000 square km, for which a minimum of 30 base stations will have to be established.