Skip to main content

Auction summary - 700 MHz (Digital Dividend) and 2.5 GHz band reallocation (2013)

Quick summary

The Australian Communications and Media Authority (ACMA) auctioned spectrum in the 700 MHz band in the 2.5 GHz band. Four applicants (Optus, Telstra, TPG Internet and Vodafone Hutchinson Australia (VHA) applied to participate in the auction. However, VHA withdrew before the auction. The auction process ran smoothly and resulted in the three remaining bidders, Optus Mobile, Telstra and TPG Internet securing the reallocated spectrum in the auction. 

Auction date Commenced 23 April 2013 and concluded 7 May 2013
Amount raised A total of 1.9 billion from the sale of 700MHz and 2.5GHz

Licence expiry

700 MHz: 31 December 2029  

2.5 GHz: 30 September 2029

Results

9 National lots of 2 x 5 MHz pairings were offered at the auction. The unsold spectrum was subsequently sold at the April 2017 auction.

Winning Bidders

Spectrum sold

(Lots and Frequency)

Winning Price*

 

700 MHz band

2.5 GHz band

 

Optus Mobile

2 x 10 MHz

703-713MHz/758-768 MHz

2 x 20 MHz

2550-2570MHz/2670-2690MHz

$649,134,167

Telstra

2 x 20 MHz

713-733MHz/768-788 MHz

2 x 40 MHz

2510-2550MHz/2630-2670MHz

$1,302,019,234

TPG internet

Nil

Nil

2 x 10 MHz

2500-2510MHz/2620-2630MHz

$13,500,000

Total spectrum sold

2 x 30 MHz

703-768MHz/758-788MHz

2 x 70 MHz

2500-2570MHz/2620-2690MHz

$1,964,653,401

Total spectrum unsold

2 x 15 MHz

733-748MHz/788-803MHz

Nil

Nil

N/A

Total         $66,200,000

* The lots were sold as packages so bidders’ values for each band are not available. The unsold lots include 733-738/788-793 MHz, 738-743/793-798 MHz and 743-748/798-803 MHz.

Spectrum Chart

Spectrum details

Band details

700 MHz band : 703 MHz - 748 MHz paired with 759 MHz - 803 MHz

The 700MHz spectrum band supports mobile broadband services across Australia and suits to providing coverage over a wide area and with high in-building penetration.

2.5 MHz band: 2500MHz - 2690MHz

Spectrum in the 2.5 GHz band has high-data capacity in densely populated high demand areas and lower in-building penetration than the 700 MHz band.

Licence type

Spectrum licences

Previous use Analog television broadcasting
2.5 GHz band: spectrum in the 2.5 GHz band has high-data capacity in densely populated high demand areas and lower in-building penetration than the 700 MHz band
Licence expiry

700 MHz band: commenced at 1 January 2015 for 15 years
2.5 GHz band: commenced on 1 October 2014 for a period of 15 years expiring on 30 September 2029 except for Perth metropolitan region and Western Australia region which commenced on 1 February 2016 for a period of 13 years and 8 months.

Allocation 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

Spectrum in the 700 MHz and 2.5 GHz band was allocated to new licensees using a combinatorial clock auction (CCA) format. The CCA consisted of two major stages over three rounds of bidding:  
an allocation stage (comprising clock rounds and a supplementary round), which determines the quantity of spectrum that each bidder secures
an assignment stage (comprising assignment rounds), which determines the specific frequency ranges awarded to each successful bidder from the allocation stage.  

Demand in the first round led to three unsold lots in the 700 MHz band. While demand for 2.5 GHz exceeded supply in the first round and reached equilibrium at the end of Clock Round 3.

Two auction design companies were engaged to conduct and verify the auction. Power Auctions a US based company experienced in the CCA format was engaged to provide an online auction system, expert advice and support to the ACMA for the auction. The Smith Institute based in the UK, who have extensive experience in supporting regulators that have auctioned spectrum using the CCA format, were engaged to verify the auction results and provide related services.

Competition Limits

Under the allocation limits, a single bidder could not acquire more than:

  • 2 x 25 MHz (50 MHz in total) in the 700 MHz band; and
  • 2 x 40 MHz (80 MHz in total) in the 2.5 GHz band
Allocation information
Technical information

Related information
  • Consultation informing the Determination for the Digital Dividend Auction
  • 2.5 GHz band review

 

Background

The last analog television broadcasting services were switched off across Australia at the end of 2013. One of the major benefits of digital television broadcasting is that it requires less spectrum than analog broadcasts even with the addition of extra digital channels. Australia’s switch to digital free-to-air television broadcasting involved services being retuned and stacked more efficiently into the broadcasting spectrum below 694 MHz. The cleared radiofrequency spectrum in the 700 MHz band is a dividend of the digital switchover. Regulatory and statutory changes enabled the ACMA to reallocate this ‘digital dividend’ to new licensees through a spectrum auction process.

In 2010 an extensive review of the 2.5 GHz band used for electronic news gathering (ENG) services recommended the ENG migrate to other frequencies (1980 to 2010 MHz and 2170 to 2200 MHz short to medium use spectrum) and the 2.5 GHz band frequency be reallocated for new uses, especially wireless communication services.

The Minister of the Department of Broadband, Communications and the Digital Economy directed the ACMA to set the reserve price in the 700 MHz band at $1.36/MHz/pop. In the 2.5 GHz band, the ACMA set the reserve price at $0.03/MHz/pop.

The ACMA made the decision to reallocate the released radiofrequency spectrum in 700 MHz and 2.5 GHz bands in a single auction. All the 2.5 GHz band spectrum sold at this auction. Whereas two 15 MHz in the 700 MHz band remained unsold. This spectrum was sold in the 700 MHz residual lots auction in 2017.

Back to top
FEEDBACK