On 3 January 2013, the Australian Communications and Media Authority (ACMA) announced a number of decisions in relation to the auction for the sale of spectrum in the 700 megahertz (MHz) and 2.5 gigahertz (GHz) bands, including lot configuration for the spectrum auction. The lot configuration decisions had earlier been published on Comlaw on 19 December 2012 in the respective Radiocommunications Spectrum Marketing Plans for the 700MHz and 2.5GHz bands. The main problem being addressed in the Regulation Impact Statement (RIS) is how to configure the spectrum to promote its efficient allocation and use. In addressing this problem, the ACMA needs to ensure that the lot configuration does not limit or dictate market outcomes or hinder competition between auction participants. The objective of the auction is to maximise the overall public benefit derived from use of the spectrum. The way lots in each band are configured will have a significant impact on the value that bidders place on the spectrum at auction and influence the future use of the spectrum. In considering the optimum lot configuration, the RIS examines a wide range of technical, commercial and policy factors that are likely to affect the overall benefit to the community derived from reallocating the spectrum. A minimum frequency bandwidth of 2x5 MHz lots appears to be ideal because it is consistent with international standards for long term evolution and can be aggregated into 2x20 MHz licences, which allows maximum spectral efficiency. It also allows the two bandwidths to be divided into equally sized lots and promotes competition in the auction. In relation to the geographic distribution of licenses, disaggregation minimises the risk that spectrum in any single geographic region would lie idle. However, increased disaggregation also increases the chances that there may be utility loss zones in which no services can be provided. This occurs when different parties own spectrum licences that share a boundary. The propagation characteristics of spectrum in the 2.5 GHz band lends itself to providing capacity in densely populated areas, while the 700 MHz band can be used to transmit signals over greater distances. This suggests that there would be benefit in geographic disaggregation for the 2.5 GHz band, while the 700 MHz band is better suited to providing national coverage. The RIS involved extensive public consultation with stakeholders. In summary, the majority of stakeholders preferred a national market area in the 700 MHz band, stating that the propagation characteristics of the spectrum allow for service coverage over large geographic areas. They also favoured a national area because it accommodates the layout of a national mobile network. Stakeholders favoured minimum frequency lots of 2x5 MHz, stating that frequency lots smaller than this were inappropriate for the operation of either 3G or 4G technologies. The RIS on lot configuration for the auction of this part of the spectrum was prepared by the ACMA and assessed as adequate by the Office of Best Practice Regulation.
- Lot configuration RIS [
1.7 MB] - Lot configuration RIS [
966 KB]