Romania Sets Terms for 3G Bids

July 26, 2004 - source: BWCS

The national telecoms regulator in Romania (the MCTI) has announced its plans to offer four 3G licences in the country by the end of 2004. The government authority has said it will put a price tag of around US$35 million on each franchise, which will be valid until 2019. Any companies or consortia wishing to put together a bid must have access to sufficient capital to cover network build. Whilst the MCTI has not put a figure on this, it has said it will only entertain proposals from companies in the field of communications which have a turnover of, at least, euros 300 million.

Besides mere financial muscle, would-be licence holders will have to convince the authority that they have sufficient experience and expertise in the field to run a next generation mobile telephone network. According to the MCTI, only the candidates that can convince them on all counts will make it through to the bidding stages.

The lucky bidders will then be evaluated on their potential to achieve three different deadlines. The first of these falls as soon as December 31, 2005, with the others being three years and then six years after that date. The wannabe licensees will have to convince the awards-panel that they will be able to meet certain coverage criteria by these dates. The first deadline is said to call for the coverage of the national capital, Bucharest, plus ten other urban areas.

The MCTI is still in dispute with former monopoly telecoms operator RomTelecom, which is now majority owned by OTE (Hellenic Telecommunications Organisation). The pair are at loggerheads over plans by RomTelecom to increase its monthly line rental charges. Without this increase, the operator says it will not be able to fund the huge investment it claims it needs to make in its networks.

In the last quarter of 2003 the regulator rejected RomTelecom's planned price increase three times. The head of the telecoms regulatory body, Ion Smeeianu, defended his actions, saying: "Our decisions have been right under the current circumstances, which are different from those existing in other European countries."