French Government Reconsiders 4th Mobile License Plan
PARIS -(Dow Jones)- The French government Wednesday set a process in motion that could lead it not to allocate the country's remaining 3G mobile telephony license to one company.
The state has mandated the French telecommunications regulator ARCEP to consider how best to allocate the frequencies that were made available under the heretofore failed fourth round of licensing.
The government said it will also ask the country's competition authorities to see whether there is anything hindering development of virtual mobile network operators, and if so, to propose corrective measures.
The state has twice annulled tenders for the fourth license because either no companies were interested, or due to demands for financial terms it was unwilling to provide.
The prime minister's office Wednesday said ARCEP has been charged with conducting "a large public consultation" to determine the relative benefits of granting all available fourth-round frequencies to one company or whether the frequencies should be split up and allocated to more than one operator.
Current holders of French 3G licenses include the big three mobile network operators, who collectively control 96% of the market. These are France Telecom's Orange mobile phone unit; SFR, co-owned by Vivendi and Vodafone Group; and Bouygues Telecom, a subsidiary of diversified construction group Bouygues.
French officials had told Dow Jones Newswires a month ago that the government was considering abandoning the fourth round of tenders for the final 3G license.
After the most recent failure to allocate the fourth round license, government officials said they would consider alternatives to the single-licensee concept.
"The consultation will determine if and under which conditions and alternative scheme best responds to the objectives of stimulating competition in the telephone market to the benefit of consumers," Prime Minister Francois Fillon's office said in a statement.
"That includes the improvement of the position of virtual mobile network operators, the development of innovation and the improvement in the area of coverage for mobile telephony," the statement added.
Only one company had tendered for the fourth license in the previous tenders. That was mid-sized telecoms operator Illiad, which had asked for favorable terms or a reduction of the EUR619 million it had bid.
The prime minister's office said Wednesday that the ARCEP consultation should consider projects proposed by existing license holders and possible new entrants to the market.
The results of this consultation will be made public by Sept. 30.
The government's eventual plans will be debated in parliament, in which the conservative government of President Nicolas Sarkozy has a comfortable majority.
-By A.H. Mooradian, Dow Jones Newswires, +33 1 4017 1740; art.mooradan@dowjones.com.
(Geraldine Amiel in Paris contributed to this story.)
(END) Dow Jones Newswires
Posted to the site on 30th April 2008
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