Singapore unswayed by Asian softening on 3G

date: 18th January 2001, source: yahoo.com

The Singapore auction of third-generation (3G) mobile communications licences will definitely go ahead, but there could be some "tweaking of the rules," officials said Thursday, amid signs of softening regional interest.

Draft plans for the auction will be released next week, and changes could be made depending on feedback from the industry, Info-communications Development Authority (IDA) corporate communications manager Dulcie Chan told the press.

But the major features of the licensing process will not be changed, the spokeswoman for the industry regulator said.

These include auctioning the licences with a 150 million Singapore (86.7 million US) dollar reserve price, rather awarding them in a "beauty contest" -- favoured by the industry -- where applications are considered on merit.

There are only four known bidders for the four licences, but IDA deputy chief executive Leong Keng Thai told the Business Times that officials had spoken to more than 20 telecoms companies in Europe, the United States and Asia and the response was positive.

"Obviously, how many of those will come to the auction, nobody knows," he added.

IDA's determination to press ahead with the 3G sale comes as Hong Kong considers postponing its June auction, citing economic and technological uncertainties.

In South Korea, where licences were recently allocated, Korea Telecom has said it may delay commercial deployment of 3G services.

The Singapore auction was originally set for February, but early this month it was deferred until April.

IDA said the delay was requested by telecoms companies wanting more time to consult the regulator about procedures, and not because of feeble investor interest.

Leong said players IDA had spoken to have accepted there will be an auction but "there are 1,001 ways you can carry out an auction. And there is more concern now over which of the 1,001 ways will be used."

Details such as moving from one round of the auction to the next, setting an end date for the sale and establishing rules to prevent collusion between bidders had to be settled, he said.

The 3G system allows dramatically faster mobile applications than those currently possible, including video communication using mobile phones and high-speed Internet access.

When Singapore announced in October it would sell four licences, with opening bids of 150 million dollars, there were estimates they would return at least two billion dollars, after similar auctions proved a windfall for European governments in frenzied bidding last year.

Britain raised more than 35 billion US dollars and Germany almost 50 billion US dollars from 3G auctions.

But the only reported bidding interest in Singaore so far has come from the three incumbent telecommunications players, Singapore Telecommunications, MobileOne and StarHub as well as Sunday Communications of Hong Kong.

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