The auction on 21 September raised 4.42 billion EUR, of which 2.2 billion EUR for mid-range frequencies
The Italian 5G strategy kick-started late in 2016 when the domestic NRA announced the start of a fact-finding survey for the development of mobile and wireless systems towards the 5G and the utilization of the spectrum above 6GHz. Two years later, in May 2018, AGCOM announced that 5G multi-band spectrum auctions (700 MHz, 3.6-3.8 GHz and 26 GHz) would be held late in September 2018. The 5G tender process was approved in July 2018 with rules in favor of newcomers.
Globally 1,275 MHz are offered for sale broken down into 700 MHz frequencies (75 MHz), all the upper part of the 3.4-3.8 GHz frequencies (200 MHz divided in two blocks of 80 MHz and two blocks of 20 MHz in 3.6-3.8 GHz) and all the upper part of 26 GHz frequencies (1 GHz divided in five 200 MHz blocks in 26.5-27.5 GHz).
Seven operators prequalified in August 2018 including Telecom Italia, Wind, Tre, Vodafone, Illiad, Fastweb, Linkem and OpenFiber. Only the first five operators, Telecom Italia, Wind, Tre, Vodafone, Illiad and Fastweb submitted bids for about 2.48 billion EUR, in line with the government’s expectations (2.5 billion EUR). As a new player, Illiad was allowed to bid for a reserve package of up to three blocks in 700 MHz frequencies worth of 676.5 million EUR.
The process started mid-September and ended on October 2nd, 2018. The whole auction ended after 14 days of intense bidding, far above expectations, reaching 6.55 billion EUR of which 4 billion EUR for the highly-coveted mid-frequencies.
The 700 MHz auction
The 700 MHz auction process ended mid-September. 700 MHz frequencies raised globally 2.04 billion EUR. Telecom Italia announced it had paid 680.2 million EUR for 2×10 MHz. Illiad paid 676.5 million EUR for 2×10 MHz. Vodafone spent 683.2 million EUR for 2×10 MHz. Licenses are valid 15 years, starting in 2022.
The 3.6-3.8 GHz auction
The mi-band auction ended on October 2nd, 2018, 14 days after start and 171 rounds. Telecom Italia and Vodafone won the largest blocks of spectrum (80 MHz each) for approx.1.7 billion EUR each. Respectively they paid 1.694 billion EUR and 1.685 billion EUR. Wind and Iliad paid 483.9 million EUR each for 20 MHz of spectrum each (483.92 million EUR for Wind and 483.9 million EUR for Illiad). Overall, the 3.7 GHz auction hit over 4 billion EUR reaching 4.3 billion EUR. The average price of spectrum closed at 18 cEUR/MHz/PoP/10 years significantly higher than in the UK or in Spain.
The 26 GHz auction
The process ended on October 2nd, 2018, 14 days after start. The auction for 26 GHz frequencies have not shown a huge interest by players. The five lots were allocated, raising a total of 167.3 million EUR. Telecom Italia paid its slot 33 million EUR, Illiad received another lot for a little less at 32.9 million EUR, while Fastweb, Wind and Vodafone paid 32.6 million EUR each.
