UMTS auction unlikely to boost federal coffers

Switzerland's UMTS auction can be followed on the Internet Keystone

Switzerland's auction of third generation mobile phone licences is underway. Only four companies are bidding for the four licences on offer so the sale is not expected to raise anything like the revenues earned in other European countries.

This content was published on December 6, 2000 minutes

The first round of bidding for Switzerland's Universal Mobile Telecommunications System (UMTS) kicked off on Wednesday morning, with Switzerland's largest operator, Swisscom, bidding for a licence, along with Orange, Telefonica of Spain and Sunrise/diAx.

The federal communications office has planned eight rounds of bidding on Wednesday, and a further eight on Thursday.

However, the office's chief, Fulvio Caccia, says the sale will probably be over quickly. He estimates that the first two licences will be snapped up at the opening bid price of SFr50 million ($30 million) each.

Caccia says the sale of the remaining two licences could take a little longer, but he does not expect them to fetch more than SFr60-70 million each. The only factor that might push up the opening bids is the UMTS frequency that operators want.

The auction was due to have taken place on November 13, but was cancelled at the last minute following a sudden merger between two of the bidders - Sunrise and diAx - on the eve of the sale.

The government had high hopes that the auction would attract billions, following a series of highly publicised auctions around Europe which brought in billions of francs into government coffers.

The top auctions raised SFr79 billion in Germany and SFr56 billion in Britain. However, there have also been disappointments. The licences in Italy, for example, went for a total of SFr18 billion.

Licences in the Netherlands attracted SFr4 billion and SFr1.07 billion in Austria.

UMTS will in future enable providers to offer a whole new range of fast mobile Internet, data and multimedia services that are way beyond the capabilities of current Global System for Mobile (GSM) networks.

The auction can be viewed at the Internet address below.


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