The final stage of the French 5G tender ended on 01 October, completing the sale of 310 MHz of spectrum in the 3.4-3.8 GHz band.
Telecom regulator Arcep said that proceeds amounted to EUR 2.79 billion, which compares with the floor price of EUR 2.17 billion set by the government at the end of last year.
Market leader Orange accounted for the highest spend, at EUR 854 million for 90 MHz of spectrum. Altice France subsidiary SFR acquired 80 MHz for EUR 728 million, while Bouygues Telecom and Free Mobile both secured 70 MHz for EUR 602 million.
In the first phase of the award, the French government had agreed to sell 200 MHz at a set price of EUR 1.4 billion, with each of the four network operators spending EUR 350 million for a block of 50 MHz.
After a pause due to the Covid-19 health crisis, the regulator was asked to oversee an auction for the remaining 110 MHz of spectrum available, sold in equal-size chunks (10 MHz) at a starting price of EUR 70 million per block.
Bidding lasted just three days, with the unit price rising from EUR 70 million to EUR 126 million by the end of the final round. In addition to the initial 50 MHz, Orange secured the most spectrum in the auction (40 MHz), followed by SFR (30 MHz). Bouygues Telecom and Free Mobile were each attributed two blocks (20 MHz).
Spectrum acquired in the auction will have to be paid for over four years, while the set price of EUR 350 million will be spread over the fifteen-year duration of the licences, which can be extended by a further five years under conditions set by Arcep.
The final amount spent in the tender will be known at the completion of the last step of the award process, in which the four participants will bid in a “positioning” auction to determine where their spectrum will be placed in the 3.4-3.8 GHz band.
French operators will also be able to rely on other frequencies for their 5G deployments. These include the 700 MHz band, which was awarded by Arcep in 2015, and in future 26 GHz frequencies, still to be allocated.
orange commented that the total amount raised in the tender remains reasonable compared with other large European countries, such as Germany. CEO Stephane Richard said that the company was very satisfied with the auction process, noting that the result was “well balanced” and encouraged operators to invest.
The rules set by Arcep capped the amount of spectrum per operator at 100 MHz, including the 50 MHz block sold at a set price. Industry’s expectations were that this limit, coupled with the decision to auction blocks of equal size (10 MHz each), could keep a lid on auction bids.
Including 90 MHz in the 3.4-3.8 GHz band, Orange retains the largest portfolio of frequencies in the French market with 257 MHz overall, while SFR defends its runner-up position holding nearly 245 MHz across all bands.
Source: Telecom Paper