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Austria’s auction for wireless spectrum, which will free airwaves for high-speed mobile services, may be delayed until 2013 as regulators grapple with a tie-up between two of the largest providers.
Hutchison Whampoa Ltd. (13), the telecommunications company owned by Hong Kong billionaire Li Ka-shing, agreed to acquire Orange Austria this month in a deal valued at 1.3 billion euros ($1.7 billion). The government, which had planned an auction in September, is going to examine how this will affect the bidding process, said Hans Tschuden, chief financial officer of rival Telekom Austria AG. (TKA)
A delay will put off distribution of spectrum that could carry high-speed signals to mobile phones, enabling faster downloads of videos and other bandwidth heavy services. Telekom Austria could offer the more advanced services, known as long- term evolution, by next year if the auction goes ahead in September, Tschuden said in an interview in London.
“The regulator wants to have a clear picture: are there three operators or four operators bidding for this spectrum? And therefore, it could be that he’s postponing the auction for a year,” Tschuden said in an interview. “The spectrum we need to run our business, we do have. The only thing which is postponed materially is the spectrum that is designated for the LTE rollout.”
Daniela Andreasch, a spokeswoman for the Austrian Regulatory Authority for Broadcasting and Telecommunications, said it is too early to say whether the auction will be delayed. Austria’s Federal Competition Authority said the Hutchison- Orange deal hasn’t been registered with regulators and the agency hasn’t begun examining it for antitrust issues, spokeswoman Veronika Haubner said.
Telekom Austria is also involved in the buyout of Orange’s Austrian mobile services from France Telecom SA (FTE) and Mid Europa Partners, agreeing to buy the Yesss! network, which sells prepaid wireless services, as part of the deal.
While the Federal Competition Authority has said the deal may have to be amended, Tschuden said he is confident that the company won’t have to make any divestitures. The key will be to show regulators the difference between the prepaid and contract- based mobile markets, he said.
Tschuden is aiming to make the former Austrian monopoly profitable this year after posting a 252.8 million-euro net loss in 2011. The company will cut jobs and reduce overlapping systems in its wireless and fixed-line businesses this year, Tschuden said.
Telekom Austria operates mobile networks in seven eastern European countries. Egyptian billionaire Naguib Sawiris and private equity investor Ronny Pecik own 20 percent of the company, with the Austrian government holding 28 percent.
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