Australian Digital Dividend Spectrum Auction Concludes by Raising $2 Billion.

By | May 12, 2013

Australia Spectrum AuctionThe Australian Communications and Media Authority (ACMA) announced last Tuesday the results of the 700 MHz & 2500 MHz spectrum auction. A total of AU$ 1.96 billion (US$ 2.02 billion) was raised by licensing a combined 200 MHz in these two bands. Telstra & Optus won 2×20 and 2×10 MHz, respectively, in the 700 MHz Band. Yet, 30 MHz in this band remains unsold. In the 2500 MHz band, Telstra and Optus secured 2×40 MHz and 2×20 MHz, respectively. TGP Internet secured a 2×10 MHz license. The duration of licenses in both bands is 15 years. The table below shows the total amounts paid by each operator.



Total price (AU$)

700 MHz

2.5 GHz

Optus Mobile

2×10 MHz:
703 – 713 MHz and 758 – 768 MHz

2×20 MHz:
2550 – 2570 MHz / 2670 – 2690 MHz


2×20 MHz:
713 – 733 MHz / 768 – 788 MHz

2×40 MHz:
2510 – 2550 MHz / 2630 – 2670 MHz

TPG Internet

2×10 MHz:
2500 – 2510 MHz / 2620 – 2630 MHz


2×30 MHz

2×70 MHz


Vodafone Hutchinson Australia withdrew before the auction started because of the high reserve price.

The 700 MHz spectrum became available after migrating analog TV broadcasts to digital technology. The 2.5 GHz band is currently used by free-to-air television broadcasters for television outside broadcasting, including electronic news-gathering (ENG).

Australia digital dividend spectrum results

Results of Australian digital dividend spectrum. Source: ACMA.

The auction used a combinational clock auction (CCA), similar to that used most recently in the UK 800 MHz and 2600 MHz band auction. This is a price clock-based auction method used to sell multiple items in a single process and designed to create incentives for bidders to bid their full value for the spectrum. However, it makes it difficult (if not impossible) to assign a value to each band separately. For this, we’ll have to refer to the reserve price as guidance: it was set at AU$1.36/MHz-PoP for the 700 MHz band and AU$0.03/MHz-PoP for the 2.5 GHz band. Based on this, the auction was expected to generate AU$2.89 billion, but with the unsold allocation in 700 MHz only AU$1.96 was raised: AU$ 929 million less than expected. Setting a high reserve price has evidently backfired resulting in lower total proceeds. It shall be interesting to see how the remaining 30 MHz of prime spectrum will be allocated and how much it will raise.

2 thoughts on “Australian Digital Dividend Spectrum Auction Concludes by Raising $2 Billion.

  1. jopocop (@jopocop)

    Perhaps there is a trend that telcos are pulling back on what pricing for new spectrum, since the UK auction was rather upsetting to the govt officials, triggering a govt investigation. I read today that in Malaysia there were six licenses granted for 4G, but so far only two telcos are pushing with rollouts. I believe the recent Columbia auction had some issues according to published reports.

    1. Frank Rayal

      There is a ‘tension’ rising between regulators who have bigger expectations on auction proceeds and operators who either cannot pay that much because the business case does not allow it, or because the dynamics have shifted to their advantage: limited number of players in the auction game and high barriers to entry in this field makes them feel more protected. In either case, it is challenging for regulators to extract higher value for spectrum… In a way I wonder if this is in fact to the advantage of ‘spectrum sharing’ schemes as regulators try to find new ways to get higher utility of spectrum assets…

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