Hong Kong 3G services auction to open at $9.75M

Hong Kong officials have opened the auctionfor CDMA2000 mobile services and set the minimum bid at $9.75 million for the next 3G license. An Information Memorandum (IM) detailing the auction rules and conditions was issued Aug. 31.

The IM specifies the minimum Spectrum Utilization Fee (SUF), i.e. the reserve price, the terms and conditions of the license and other elements of the regulatory framework. The auction will be the second one to take place in Hong Kong for the assignment of radio spectrumsince the September 2001 auction of 3G mobile services.

"One license will be issued for the provision of CDMA2000 services starting from Nov. 20, 2008. Radio spectrum with a bandwidth of 7.5MHz x 2 in the 850MHz band will be assigned to the licensee. The use of such radio spectrum will be subject to a one-off lump sum payment of SUF, the amount of which is to be determined in the auction exercise," a spokesperson of the Office of the TelecommunicationsAuthority said.

The auction will be in a multiple round ascending format. Similar to the 2001 auction, this year's biddingwill be held in high confidentiality, not releasing the identity of the bidders and their submitted bids. The arrangement, according to the spokesperson, is intended to avoid "collusive behavior and manipulation" of the process.

New entrants and existing licensees may participate on their own and/or cooperation with others in the form of joint ventures or other types of agreements. Interested parties will have six weeks to prepare their applications until the Oct. 12 deadline. The auctions will be held around late October or early November.