Auction summary—800 & 1800 MHz PCS allocation 1—1998 | ACMA

Auction summary—800 & 1800 MHz PCS allocation 1—1998

Overview

Status

Complete

Auction date

20 April to 25 May 1998

Amount raised

$350.1 m (incl. $2.7 m bid withdrawal fees)

Licence end date

17 June 2013

The first Personal Communications Services (PCS) auction ran for 88 rounds from 20 April to 25 May 1998, with nine applicants. The total revenue from this allocation exceeded $350 million with the total of high bids $347.4 million and $2.7 million in bid withdrawal penalties. $196.6m was bid for the 800 MHz lots, and $150.8M for the 1800 MHz lots.

On this page

  • Overview
  • Spectrum Details
  • Auction Details
  • Bidders
  • Background

On other pages

Related Documents

Spectrum details

Band details

825-845/870-890 MHz (paired 2x20 MHz in metropolitan areas)
825-830/870-875 MHz (paired 2x5 MHz in regional & outback areas)
835-845/880-890 MHz (paired 2x10 MHz in regional & outback areas)
1710-1755/1805-1850 MHz (paired 2x45 MHz in metropolitan areas)
1710-1725/1805-1820 MHz (paired 2x15 MHz in regional areas)

Licence types

Spectrum licences

Previous use

The 800 MHz band was previously used for Telstra’s AMPS (analogue cellular) mobile telephone network. The 1800 MHz band was previously used for fixed links.

Licence period

15 years

Auction details

Type of allocation

Price based allocation of spectrum licences under s60 of the Radiocommunications Act 1992 following declaration of encumbered spectrum for reallocation by spectrum licensing under s153B(1).

Method of sale

Simultaneous multiple round auction over 88 rounds.

Competition limits

No person or specified group of persons could be allocated more than 2x15 MHz in any mainland state capital city in the frequency band 1710-1755/1805-1850 MHz; and that Telstra, Optus and Vodafone were precluded by carrier licence condition from bidding on 2x10 MHz (825-835/870-880 MHz) of the spectrum offered in the 800 MHz band in mainland state capital cities and 2x5 MHz (825-830/870-875 MHz) of that band in other areas.

Legal instruments

  • Spectrum Reallocation Declaration No 1 of 1997
    (825-830 MHz paired with 870-875 MHz; 835-845 MHz paired with 880-890 MHz throughout Australia)
    (Note: repealed in 2005 by sunset provisions of the Legislative Instruments Act 2003 – see applicant pack for an archived copy)
  • Spectrum Reallocation Declaration No 2 of 1997
    (830-835 MHz paired with 875-880 MHz in the 5 state capital cities)
    (Note: repealed in 2005 by sunset provisions of the Legislative Instruments Act 2003 – see applicant pack for an archived copy)
  • Spectrum Reallocation Declaration No 3 of 1997
    (1710-1755 MHz paired with 1805-1850 MHz in the 5 state capital cities)
    (Note: repealed in 2005 by sunset provisions of the Legislative Instruments Act 2003 – see applicant pack for an archived copy)
  • Spectrum Reallocation Declaration No 4 of 1997
    (1710-1725 MHz paired with 1805-1820 MHz in Darwin and rural areas on the east and southern coasts of Australia and the south-western corner of Western Australia)
    (Note: repealed in 2005 by sunset provisions of the Legislative Instruments Act 2003 – see applicant pack for an archived copy)
  • Radiocommunications (Spectrum Licence Limits—1.8 GHz Band) Direction 1998
  • Carrier Licence Conditions (Spectrum Re-allocation) Declaration 1998
  • Radiocommunications Spectrum Marketing Plan (800 MHz and 1.8 GHz Bands) 1998
    (NOTE: amended in July 1998 by the Radiocommunications Spectrum Marketing Plan (800 MHz and 1.8 GHz Bands) 1998 (Variation No. 1))
  • Radiocommunications (Spectrum Licence Allocation) Determination 1998 (revoked by Radiocommunications (Spectrum Licence Allocation) Determination (No. 2) 1998 in November 1998 - see applicant package for a copy)
  • Radiocommunications (Unacceptable Levels of Interference - 800 MHz Band) Determination 1998
    (revoked & replaced in December 2000 – see applicant package for a copy)
  • Radiocommunications (Unacceptable Levels of Interference -1800 MHz Band) Determination 1998
    (revoked & replaced in November 1999 – see applicant package for a copy)
  • Radiocommunications Advisory Guidelines (Protection of Apparatus-licensed Receivers - 800 MHz Band) 1998
  • Radiocommunications Advisory Guidelines (Protection of Molonglo Observatory Synthesis Telescope) 1998
    (revoked in March 2009 – see applicant package for a copy)
  • Radiocommunications Advisory Guidelines (Protection of Apparatus-licensed Receivers - 1800 MHz Band) 1998
    (revoked and replaced in November 1999 – see applicant package for a copy)
  • Radiocommunications Advisory Guidelines (Managing Interference from Apparatus-licensed Transmitters - 800 MHz Band) 1998
  • Radiocommunications Advisory Guidelines (Managing Interference from Apparatus-licensed Transmitters - 1800 MHz Band) 1998
    (revoked and replaced in November 1999 – see applicant package for a copy)
  • Radiocommunications Advisory Guidelines (Protection of Mobile Base Receivers – 1800 MHz Lower Band) 1998
    (revoked in November 1999 – see applicant package for a copy)
  • Radiocommunications (Third Party Use—Spectrum Licence) Rules 2000 (No. 2)
  • Radiocommunications (Trading Rules for Spectrum Licences) Determination 1998
  • Radiocommunications Advisory Guidelines (Registration of Devices under Spectrum Licences without an Interference Impact Certificate) 1998
  • Radiocommunications (section 145(3) Certificates) Determination 2000

Bidders

Bidders

Bidder Number

Initial Eligibility*

Winning Bid Amounts

AAPT Wireless Pty Ltd

2122

2,407,380

$10,780,420

Catapult Communications Corporation (USA based)

2117

18,410

$203,040

Global Mobility Networks Inc (USA based)

2118

1,257,875

nil

Hutchison Telephone Pty Ltd

2123

1,433,590

$56,889,000

Optus Mobile Pty Ltd

2121

1,975,490

$51,140,958

OzEmail Ltd

2124

3,147,600

nil

OzPhone

2126

2,536,330

$9,959,130

Telstra Corporation Ltd

2120

4,180,970

$176,039,910

Vodafone Networks Pty Ltd

2119

1,556,120

$42,467,793

Total Winning Bids

 

$347,480,251

* The maximum eligibility consistent with the competition limits was 5,614,530 for bidders other than Telstra, Optus and Vodafone and 4,191,030 for those carriers.

Background

The PCS auctions made spectrum available to support the government’s decision to open the Australian telecommunications market to full competition from 1 July 1997. Public consultation confirmed that additional spectrum was required to facilitate mobile telecommunications competition and expedite the introduction of PCS in the 1800 MHz band. A brief history of mobile telephony in Australia is useful to place the PCS allocations in their historical context.

AMPS

In 1987, Telstra, then Telecom, launched Australia’s first cellular mobile telephone system based on the USA AMPS (Advanced Mobile Telephone System). AMPS operated in the 825-845/870-890 MHz part of the band and used the analogue standard. Optus, which became Australia’s second carrier in 1991, commenced reselling Telstra’s AMPS service in 1992. Also in 1992, the government decided to phase-out the analogue AMPS system favour of the digital GSM (Global System for Mobiles) system. The AMPS system was phased-out between 1 January 1997 and 31 December 2000.

GSM

As noted above, the government decided to introduce the digital GSM system. It was to be operated by 3 competitors, Telstra, Optus and new player Vodafone, which had been selected by tender for the award of the third Australian public mobile carrier licence. The three carriers were allocated approximately 8 MHz of paired spectrum each in the 890-915/935-960 MHz part of the 900MHz band for a fixed annual fee. The spectrum was authorised by PMTS B (Public Mobile Telecommunications Service Class B) apparatus licences. The three GSM systems commenced operation during 1993.

PCS

Following public consultation by the Spectrum Management Agency (SMA) during 1996 and 1997, the Minister made a re-allocation declaration under s153B of the Radiocommunications Act 1992 (the Act) for the 800 MHz band formerly used for AMPS and the 1800 MHz band. A total of 2x75 MHz had been identified in the 1800 MHz band to be suitable for PCS purposes. However, in response to industry comment, the government decided to auction only 2x45 MHz during the first three auctions and make the remaining 2x30 MHz available at a later date.

This required the Australian Communications Authority (ACA – established 1997) to re-allocate the following parts of the spectrum by issuing spectrum licences for Personal Communications Services (PCS):

  • 2x20 MHz from 825-845/870-890 MHz in metropolitan areas
  • 2x5 MHz from 825-830/870-875 MHz in regional and outback areas
  • 2x10 MHz from 835-845/880-890 MHz in regional and outback areas
  • 2x45 MHz from 1710-1755/1805-1850 MHz in metropolitan areas
  • 2x15 MHz from 1710-1725/1805-1820 MHz in regional areas

The Minister also directed the ACA to implement competition limits to increase the likelihood of new entrants acquiring spectrum.

The ACA offered the spectrum in 230 lots at the first PCS auction in April/May 1998. Unsold lots were again offered at the second and third PCS auctions in September 1998 and May 1999. The first PCS auction was a simultaneous multi-round type, while the second and third were open outcry auctions. A total of $381 m was received for the spectrum sold at the three auctions.

The 800 MHz spectrum progressively become available as the AMPS system was phased out. 2x5 MHz of this spectrum (830 835/875-880 MHz) was not reallocated outside metropolitan areas during these auctions in case a residual AMPS service was required in country areas. It was eventually allocated in February 2001 (the Remaining 800 MHz auction).

Last updated: 05 December 2017