Both operators were awarded a 10 MHz block for €21 million each valid until 2038

Today, the Spanish Ministry of Economic Affairs and Digital Transformation has announced that it has sold off its final two 10 MHz blocks of spectrum in the 3.5 GHz band, with Orange and Telefonica acquiring one new block each.

Spain has chosen to sell the spectrum in this band in stages, selling around half the available spectrum five years ago, with the majority of that left over sold in 2018. When the dust settled from this auction, Orange held 100 MHz, Telefonica and Vodafone both had 90 MHz, and MasMovil has 80 MHz.

However, there was still 20 MHz of additional spectrum up for grabs, which is what we have seen sold today.

In this auction itself, only Orange and Telefonica chose to bid, ultimately paying €21 million each for one 10 MHz block.

Thus, after this auction Orange remains the largest 3.5 GHz spectrum holder in Spain with 110 MHz, with Telefonica close behind at 100 MHz, then Vodafone with 90 MHz and MásMóvil with 80 MHz.

The Spanish regulator will now reorganise the 3.5 GHz band to ensure that the operators have contiguous spectrum blocks, allowing for a more efficient use of the spectrum. This is good news for the operators and something that some regulators, such as Ofcom in the UK, have been loath to intervene in.

“The next step will be to reorganize the frequencies so that all operators have contiguous blocks of frequencies and, therefore, make more efficient use of the radio spectrum in the deployment of 5G technology and services,” said Ministry. 

This year should see two more Spanish 5G auctions – both of which are likely to be far more exciting than this one.

The first will be for the 700 Mhz band, taking place in March. This is one of the most attractive bands for 5G and its price is expected to reflect that, estimated to be priced at between €0.36–0.42/MHz. This is not quite as high as spectrum in some European countries, like Italy, but it is still expensive. Just this weekend, Jean-Francois Fallacher, Orange Spain’s CEO called on the government to lower the asking price for this auction, which currently aims to raise €1.17 billion.

The second spectrum auction, with a date yes to be confirmed, will be for the 26 GHz band.

Telefonica, Orange, and Vodafone will all likely bid in these auctions, while MasMovil appears less likely, and will only do so if the price is right.

These high prices could be something of a catalyst for the many rumours currently circulating about consolidation of the Spanish telecoms market, with Vodafone and MasMovil seemingly most likely to merge.


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