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(ARCHIVED) Expiry of spectrum rights – implementation

 

(ARCHIVED) Renewal of 800/900 MHz cellular rights


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Management rights in the 800 and 900 MHz bands are used for second and third generation (2G and 3G) cellular networks. In the future, they may also be used for 4G-LTE networks. The rights expired in 2011 and 2012. Following a review of how the spectrum was being used including a public consultation, in April 2007 Cabinet agreed that the Crown would offer to renew Telecom’s and Vodafone’s rights, under two conditions:

  • either, Telecom and Vodafone could each sell 2x5 MHz to a third party, and have the remainder of their rights renewed, or
  • 2x7.5 MHz of each company’s management rights would not be renewed and the Crown would allocate them to a third party.

Telecom and Vodafone accepted the offers and both completed a secondary market sale to a new entrant, NZ Communications, which subsequently rebranded as Two Degrees Mobile.

All three rights holders were required to provide services using these management rights that covered 65% of the population.

Radio Spectrum Management (RSM) commissioned a report on the calculation of renewal prices from Network Strategies, using an incremental deprival valuation (incremental ODV) approach, which was checked for reasonableness against New Zealand and overseas benchmark values. The report was then peer-reviewed by PricewaterhouseCoopers.

The table below shows ownership of cellular management rights in these bands, following the rights renewals and sales to NZ Communications/Two Degrees. These rights all expire in 2031.

Management right owner

Frequency range

Total frequencies covered

Telecom825.015-840 MHz
870.015-885 MHz
2x15 MHz
Two Degrees890-899.8 MHz
935-944.8 MHz
2x9.8 MHz
Vodafone899.8-918 MHz
944.8-960 MHz
2x15.2 MHz

Documents

  • Discussion paper (157 KB PDF)
    This paper sets out the case-by-case review for the renewal of management rights for cellular services in the 800 MHz and 900 MHz bands. It also describes an incremental optimised deprival valuation approach for the renewal of cellular rights.
  • PWC -NZIER report [973 KB PDF)
    Report from PricewaterhouseCoopers and the New Zealand Institute of Economic Research on a proposed pricing approach for the renewal of cellular rights.
  • CRA International peer review (64 KB PDF)
    CRA International peer review of the report from PricewaterhouseCoopers and the New Zealand Institute of Economic Research.
  • Network strategies report (869 KB PDF)
    Renewal of Management Rights for Cellular Services (800/900 MHz) - Calculation of Renewal Prices Report November 2007.
  • PWC review [181 KB PDF)
    Renewal of management rights for cellular services (800/900 MHz) calculation of renewal prices - PricewaterhouseCoopers review of Network Strategies report November 2007.
  • Cabinet paper (19 KB PDF)
    Cabinet paper on the Renewal of Cellular Rights.

 

Last updated 9 December 2014