The auction raised over €1 billion, with the extra spectrum set to help the operators deliver better non-standalone (NSA) 5G both indoors and for large outdoor areas

Spain’s 700MHz spectrum auction has been a long time coming. The auction was first planned to take place in early 2020 but, as was the case in so many markets around the world, the onset of the coronavirus pandemic saw these plans delayed. Since then, disputes over price and conditions related to the spectrum licences saw the process delayed even further. 

In response, in May, the regulator lowered the reserve prices on the spectrum by 15%, as well as removing obligations to grant third-party operators access to the infrastructure, in an attempt to drive up interest.

In total, the auction process was delayed by 18 months. 

Now, however, the Spanish Ministry of Economic Affairs and Digital Transformation has finally announced the conclusion of the auction, seeing €1.01 billion raised and Orange, Vodafone, and Telefonica all securing additional spectrum. 

Vodafone, Orange, and Telefonica all acquired 2x10MHz blocks of 700MHz spectrum. Vodafone and Orange will both pay €350 million for their allocations, while Telefonica’s was slightly cheaper at €310 million, as a result of faster rollout obligations.

The spectrum rights will last until 2041, with an automatic renewal to 2061 for no additional fees, provided licencing conditions surrounding coverage are met by deadlines. The operators are obligated to activate 5G services in 450 localities with populations above 50,000 by the end of June 2025, as well as covering the country’s largest airports, train stations and motorways.

But while the auction is an outward success and will surely help deliver 5G to wider areas around Spain, the auction also had its failures. For one thing, there were notably no bidders for any of the 5MHz blocks of non-paired spectrum, meaning the auction did not reach the €2.1 billion target set by the regulator for the auction.

But perhaps the elephant in the room was, in fact, who was missing from it. Masmovil, who has had an uncomfortable relationship with the auction for a number of months, ultimately decided not to participate in this auction, despite the changes to the conditions.

The company is currently in the process of acquiring Spain’s fifth-place mobile operator Euskaltel, (hence this company also choosing not to participate) and had asked that the auction process be further delayed until the merger was complete. Masmovil had additional demands, including that the regulator reserve part of the spectrum at a reasonable price for operators without frequencies in low bands, or dividing up the blocks on a regional basis.

Masmovil was not alone its complaints to the regulator; Spain’s National Association of Local Telecommunications Operators (Aotec), for example, bemoaned that the auction totally excluded alternative operators and discriminated against a sizable portion of the population.

Ultimately, however, the regulator chose to ignore these demands, leaving Masmovil to sit out this auction process. This means that, for now at least, the operator will have to rely on its existing 3.5GHz spectrum alone for 5G services.

But there will be more opportunities to gain 5G spectrum, albeit of a vastly different variety. Spain is currently planning its third and last 5G spectrum auction, this time in the 26GHz band, before the end of the year. 

The bidding intentions for the operators for this mmWave spectrum remain unclear.


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