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Apr. 15, 2010

After India launched its own wireless spectrum auction last week, now it's the turn of Germany to follow through.

The German government yesterday took the lead on the deployment of modern 4G technology with the launch of a new wireless spectrum auction involving 360 megahertz of spread across four bands: 800 MHz, 1.8 GHz, 2 GHz and 2.6 GHz.

Some wireless industry analysts were expecting the move, and think there's more of this to come in the next few weeks, as they expect other countries in Europe to follow through.

Germany said the spectrum bands were being awarded “on a technology and services-neutral basis,” though most observers expect the spectrum to be used to launch networks using LTE-based technology.

This is a marked difference from previous auctions that required winning bidders to launch a specific technology conforming to the majority of wireless carriers in Europe.

After India last week, Germany's spectrum auction is expected to set the tone for upcoming 4G auctions across all of Europe some say.

In the last two weeks, no less than six wireless carriers had originally applied to participate in the auction, though only 4 made the final round.

Those qualified bidders include E-Plus Group, Telefonica O2 Germany, T-Mobile Europe and Vodafone.

The wireless spectrum up for bids includes up to 41 frequency blocks split amongst these different bands:

6 blocks of 2 x 5 megahertz paired spectrum in the 800 MHz band.

5 blocks of 2 x 5 megahertz paired spectrum in the 1.8 GHz band.

4 blocks of 2 x 5 megahertz paired spectrum.

1 block of 1 x 5 megahertz of unpaired spectrum.

1 block of 14.2 megahertz unpaired spectrum in the 2 GHz band.

14 blocks of 2 x 5 megahertz paired spectrum.

10 blocks of 1 x by unpaired spectrum in the 2.6 GHz band.

So far, through round 15, the German auction has generated more than $190 million in top bids. Some were expecting a bit less, though.

However, the most sought after wireless spectrum is expected to be in the 800 MHz range.

It will offer greater mobile service propagation characteristics compared to the other bands and should require fewer cell antennas for nationwide coverage requirements.

Most observers expect the totals to fall well short of the $68 billion in winning bids Germany generated from its previous auction of 145 megahertz of 3G spectrum back in June 2000, with some wireless industry analysts expecting the current auction to generate approximately between $10.2 billion and $14.9 billion.

Two years ago, the U.S. government auctioned off 80 megahertz of spectrum in the 700 MHz range that generated almost $20 billion in winning bids.

Verizon Wireless and AT&T won a majority of that spectrum and promptly announced plans to launch LTE-based networks using the spectrum.

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Source: GWAA.