SINGAPORE-The Singapore Government announced on Oct. 20 it will award four third-generation licenses in an auction starting next February.
There was speculation that the Infocommunications Development Authority of Singapore would use the “beauty contest” model, whereby a regulatory agency chooses license winners based on the most attractive models presented.
The minimum bid for each license is $88 million, which means incumbents Singapore Telecom, Mobile One and StarHub, will face foreign telecom companies, some with deep pockets, for the right to roll out 3G services by the end of 2003.
Minister for Communications and Information Technology Yeo Cheow Tong said, “The government is confident that this 3G licensing framework will result in the rapid deployment and provision of innovative 3G services.”
Countries such as Germany and Britain have raised huge amounts through 3G license auctions, and this attracted Singapore to the auction model. Industry observers have cautioned that higher bids might mean a higher bill for end users.
Yeo, however said, “The 3G market will have a competitive multioperator environment.”
He added substitute products, such as enhanced second-generation networks, will help check the pricing of 3G networks. Yeo added the auction method was chosen by Singapore because spectrum allocations would be given to those who value it the most. He said it was difficult to establish what criteria to use in a beauty -contest model as it was not clear how traditional yardsticks, such as network coverage, are relevant to the 3G model.
StarHub said it hoped the auction’s rules would not ultimately pass the cost outlay to the consumer. M1 Chief Executive Neil Montefiore said upfront payment for the auction would impact the availability of funding worldwide for investments in both infrastructure and service development.
The auction rules will be published in December, and bids invited. Bids have to be submitted by February, when the auction proper will start and continue for anywhere between two weeks and two months. Rollout of 3G services is expected to commence by 2003.
