Singapore to proceed with 3G mobile licence auction even with less than 4 bids

date: 12th January 2001, source: mformobile.com

The government will proceed with its planned auction of four 3G mobile phone licences even if it receives less than four bids, Minister for Communications and Information Technology Yeo Cheow Tong said.

"If there are less than four bidders for the four licences, we will still proceed with the auction," Yeo said in response to queries in parliament.

Despite 3G licence auctions in other countries resulting in exorbitant bids, Yeo said the government still prefers auctioning the licences rather than through a "beauty contest," which involves judging the winning bidders based on the technology offered by prospective operators.

"While several other countries have chosen a beauty contest for selecting 3G operators, our assessment is that making a judgement amongst bidders for emerging technologies such as 3G is entirely subjective," Yeo said.

"As it is still uncertain what would be the key 3G services, it would be very difficult for the regulator to define the services and technical criteria for evaluating proposals in a beauty contest," he said.

"Operators will naturally prefer a beauty contest mechanism with minimal fees because obtaining the spectrum cheaply will mean an immediate windfall profit for them. However, the government has a responsibility to obtain fair value for a scarce resource," he said.

The award of 3G licences through an auction is the most objective, efficient and transparent means of allocating the scarce radio frequency spectrum available, he said.

"Notwithstanding the large sums that have been collected in some European 3G auctions, we expect that the participating telecom companies will have learnt from the earlier 3G auctions and bid rationally in our auction," he said.

The reserve price for each licence is 150 mln sgd.

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