Regulator includes coverage requirements, plus bonus scheme in 5G auction proposal; says no need to provide MVNO access to 5G

Austria’s telecom regulator on Monday published a consultation into the award of frequencies for 5G mobile services in which it proposed that the available 700 MHz band spectrum would have coverage obligations attached to it and detailed a potential bonus system to incentivise operators to prioritise rural rollout.

The Austrian Regulatory Authority for Broadcasting and Telecommunications (RTR) is due to auction off spectrum in the 700 MHz, 1500 MHz and 2.1 GHz bands in the first half of next year, subject to the Transport, Innovation and Technology Ministry’s approvals of the sale conditions.

The first stage of the process will see six 2 x 5 MHz blocks of 700 MHz and 12 2 x 5 MHzblocks of 2.1 GHz frequencies put up for sale, with the 1500 MHz spectrum, eight unpaired 10 MHz blocks of it, to follow in stage two. The whole process should be completed by the end of Q2, regulatory chief Klaus Steinmaurer said, in a statement.

The 700 MHz frequencies will carry a coverage obligation requiring operators to connect 900 rural communities with 5G. Connections must come in at a minimum of 30 Mbps downlink and 3 Mbps uplink.

However, the regulator has also devised a bonus system that could see coverage extended to 2,000 rural communities, with operators offered a discount on the cost of their spectrum for reaching additional areas.

Steinmaurer explained that a sum of money has been reserved within the minimum bids ‘pot’ in order to fund the bonus scheme.

In total the reserve prices set by the regulator come to a moderate €295 million, part of the RTR’s endeavour to ensure what it describes as "investment-friendly framework conditions."

It also highlighted a number of other rules designed to achieve that end, including the fact that it will permit active and passive network-sharing to enable operators to meet the conditions of their licences; the 20-year licence durations, which should help operators amortise their 5G network spend; and cooperation models between telcos and operators of railways and highways that will help operators meet coverage requirements on transport routes.

Finally, the state will not force operators to open up their 5G networks to MVNOs. There was a requirement for virtual operator access in a previous iteration of the framework, but the RTR has deemed this no longer necessary following a recent market assessment.

However, the rules are still merely proposals until they are approved by the government. The consultation closes next month.