CallPlus calls for exclusion of majors in spectrum auction

The planned 'use it or lose it' penalty regime is not sufficient to ensure competition, CEO Martin Wylie says

CallPlus CEO Martin Wylie is calling for rules to exclude the major telcos from an upcoming auction of 3G radio spectrum.

“The Australian government precluded Telstra from bidding for WiMAX spectrum and I hope that Minister Cunliffe will seriously take this on board before they finalise the rules for the auction,” Wylie says.

He argues the penalties for buying spectrum and not using it are so small it would be in the interests of the major telcos to do so and exclude others from the market for five years before those penalties kick in.

“There is only enough spectrum to allow two or, at the most, three bidders to gain access to sufficient spectrum to deploy nationwide networks," he says. "Telecom and Vodafone, with their deep pockets to bid, can ensure emerging competitors do not get their hands on spectrum that could be used to effectively compete with them."

The 2.3GHz spectrum to be auctioned, which can be used to roll out WiMax broadband services, was controversially reallocated last year.

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