Renewal of cellular rights

Background

In April 2003, Cabinet agreed to the reallocation of commercial spectrum rights on expiry. It was agreed that commercial spectrum rights be reallocated five years before expiry to existing right holders. Management rights for cellular services in the 800 and 900 MHz spectrum bands expire in 2011 and 2012.

This decision was made after a case-by-case review of spectrum right holders in the 800/900 MHz spectrum bands.

In April 2007, Cabinet agreed that a 7.5 MHz pair of 800/900 MHz spectrum should not be offered for renewal but offered by auction, and that renewal offers be made to existing right holders – Telecom and Vodafone – for the remaining spectrum.

However, Cabinet also agreed that if Telecom or Vodafone complete a secondary market sale to a new market entrant of at least a 5 MHz pair of 800/900 MHz spectrum within six months of the renewal offer being made, then the seller will be offered the remainder of the 7.5 MHz pair that would otherwise have gone to auction.

The Ministry of Economic Development commissioned a report on the Calculation of Renewal Prices from Network Strategies, which was peer reviewed by PricewaterhouseCoopers.

Renewal offers, based on a price that is an estimate of the market value of the rights, went out to Telecom and Vodafone on 9 November.

The Minister released the renewal offers on 27 November 2007.

Telecom and Vodafone accepted the offers, completing a secondary market sale to a new entrant, NZ Communications. The Minister announced the acceptance on 15 May 2008.

Documents

Contact

For enquiries on this process, please contact:

Brian Miller
Manager
Radio Spectrum Policy and Planning
Ministry of Economic Development
Wellington
+64-4-462 4221
radiospectrum@med.govt.nz