Competition limits set for the auction will mean that no bidder can acquire more than 25% of the available spectrum in metropolitan areas and no more than 50% in regional Australia.
For a licence of the maximum spectrum allowable under the competition limits,the reserve price will be approximately $300 million.
ACA Chairman, Tony Shaw, said in a media releases that it was not possible to draw inferences from the reserve prices about the revenue which might be realised from the auction.If there is strong bidding in the auction, the revenue may be substantially higher than the aggregate reserve price.
Mr Shaw added, The history of our spectrum auctions shows that ultimate revenues have generally been significantly greater than the reserves. On the other hand, if bidding is not strong, or if bidders consider the reserve prices to be too high, the revenue from the auction would be lower.
Seven bidders confirmed on February 19, 2001 that they would take part in the auction, lodging eligibility payments totalling more than $830 million. They are AAPT Spectrum, CKW Wireless, Hutchison Telecommunications, Optus Mobile, Telstra, 3G Spectrum Holdings and Vodafone Pacific.
Successful bidders will be allocated licences for a 15-year term commencing in October 2002.
The licences will be allocated using a simultaneous ascending auction in which all lots are offered for bidding at the same time. Bidders may bid on any lot or combination of lots subject to bidding limits. The auction will be conducted over a number of rounds, through electronic bidding over the Internet, with the results of each round being made available to all bidders and to the public, also through the Internet.
