700 MHz auction
The government has announced plans to auction the ‘digital dividend’ 700 MHz radio spectrum later this year. The 700 MHz band is the spectrum freed up by the switchover to digital television, and is well suited for 4G mobile broadband.
On 4 September 2013, the government announced that:
- The auction is provisionally scheduled to commence on 29 October 2013.
- Bidder registration will open on 11 September 2013.
- The auction will be run as a simplified combinatorial clock auction.
- The reserve price will be set at $4.4 million per paired MHz ($22 million per 5 MHz paired lot).
- Successful bidders will have an option to pay for the spectrum management rights over five years, with interest and appropriate security applied.
- All successful bidders who purchase three or four lots will be required to build (respectively) five or ten new cellsites each year for five years, in areas in which they do not currently provide mobile coverage using their own infrastructure.
- Successful bidders that already operate cellular mobile networks will be required to upgrade 75% of their existing 850/900 MHz 2G/3G cellsites in rural areas to 4G using 700 MHz, within five years, up to a maximum of 300 cellsites each.
- Successful bidders that do not already operate cellular mobile networks will be subject to the implementation requirements proposed in the consultation: 50% national population coverage including 30% in each region, within five years (for a successful bid for 15 paired MHz).
- The auction will use specialised software, which registered bidders will be given an opportunity to test prior to the auction.
Further information about the auction will be published on this website shortly, including details of the payment scheme, the Auction Catalogue, and registration forms.
The government has previously announced that:
- The 700 MHz band will be allocated by competitive auction, as management rights commencing 1 January 2014 and expiring 28 November 2031
- New Zealand will adopt the ‘APT Band Plan’ for the 700 MHz band, consisting of 45 MHz paired. This will be subdivided into 9 blocks for allocation, each consisting of 5 MHz paired
- The auction will be subject to acquisition limits (or ‘spectrum caps’) of 2x15 MHz, which may be relaxed to 2x20 MHz during the auction depending on demand
- Successful bidders will be subject to both implementation requirements for spectrum purchased and a broader obligation to extend mobile cellular coverage.
Documents for consultation
The government ran a consultation on the auction earlier in 2013. The consultation process comprised:
- a consultation document, setting out the key proposals
This document is supported by
- draft Management Rights, demonstrating the Ministry’s view on the rights to be allocated in the auction
- draft Deeds, which all successful bidders will be required to sign before receiving their Management Rights, giving effect to ongoing acquisition limits and implementation requirements
- a document which identifies procedural issues that will require detailed rules – these rules will be dependent on the final structure of the auction and the auction provider
- a technical report on the coexistence of existing fixed services in the KK band and the potential deployment of cellular mobile services in the 700 MHz band.
This consultation has now closed.
The Ministry held a workshop on the auction on Wednesday 29 May, to provide an opportunity for interested parties to clarify the proposals or assumptions within the consultation documents.
- Workshop presentation slides [1.2 MB PDF]
- Information about how the Ministry developed the technical parameters of the management rights [39 kB PDF]
- Flow-chart of the auction process [112 kB PDF]
- Chart of potential auction scenarios [26 kB PDF]
- Options for placement of spectrum blocks in the combinatorial assignment phase [37 kB PDF]
- Auction workshop Q & A [164 kB PDF]
- Read the auction commencement date and reserve price announcement by the Minister for Communications and Information Technology (Published 4 September 2013)
- Read the earlier announcement by the Minister for Communications and Information Technology (Published 21 February 2013).