$1.2m to become the new entrant

By ADAM GIFFORD

Pukekohe lines company Counties Power has emerged as a new entrant in the telecommunications market with its purchase of two blocks of frequency suitable for wireless local loop (WLL) services.

It paid $1.24 million in the latest frequency auction for its WLL lots, which each consist of two 20-year management rights within the 3.4 to 3.6 GHz band.

The Government made just over $9 million from the auction - $6.16 million from the nine WLL lots, $878,449 from five lots of 24.5 GHz suitable for LMDS (local multipoint distribution service) in urban areas, and $2,050,026 from Vodafone for the sole lot of 900 MHz spectrum for cellular services.

Vodafone was the top WWL bidder, spending $730,000 on a single lot. Broadcast Communications paid $710,000 for each of three lots, and TelstraClear $2.06 million for three lots.

Acting Communications Minister Paul Swain said the $9 million was at the upper end of what the Government expected.

A change to the bidding rules meant the auction was completed in less than a fortnight, rather than stretching over months.

"I think we got the process about right this time," Swain said.

He said the Government did not want to get the maximum possible price, as happened in some northern hemisphere spectrum auctions where buyers of frequency now can't raise the money to use it.

"The consumer ends up paying," he said.

Counties Power chief executive Neil Simmonds said his company wanted to become a wholesale provider of bandwidth.

"We have no intention of competing head-on with companies like Telecom in retail products," he said.

"Just as in the power business we offer to carry anyone's electricity, we expect to do the same in this market."

Vodafone carrier relations manager Francois Zegers said the company would use its WLL frequency to link cell sites in its network, as an alternative to fibre links.

Radio spectrum auction information