Hong Kong operators slam Ofta auction process

Hong Kong's six existing cellular players have slammed the planned auction for selling 3G mobile licenses, saying the process will inflate the cost of spectrum.

The six operators, including Hutchison Telecom, PCCW's CSL, and SmarTone Communications, also attacked the approach set out by regulator Ofta.

"Hong Kong's goal to ensure that consumers have access to reasonably priced, leading edge 3G services could be put at risk by the experimental, untested model proposed by OFTA's advisers," SmarTone said in the statement.

All of them suggested the auction should conclude when the fifth highest bidder drops out and only four bidders remain, in contrast to Ofta's proposal of closing the auction when the fourth bidder withdraws.

"This methodology will inflate license fees to an unnecessarily high level, both increasing the licensee operational costs and increasing the consumer tariff," said CSL, the mobile unit of Pacific Century CyberWorks.

Meanwhile, most of the operators also criticized Ofta's plan to conceal the number and the identity of the bidders until the end of the auction.

"There has never been an auction which conceals from bidders all information about the bidders, identities, bid levels and bid volumes," SmarTone said in the statement.