Australian mobile players are celebrating heightened spectrum certainty following new federal government plans for reissuing 15-year spectrum licences to carriers serving ‘significant numbers’ of consumers, says Communications Day’s Petroc Wilton.

Communications Day says that after Communications Minister Stephen Conroy made the announcement in Sydney to AMTA’s Members Forum that attracted an audience that spanned the breadth of the mobile telecoms industry, the mood in the room was decidedly jubilant – but the devil may yet be in the details, with the reissue contingent on a host of public interest criteria as well as price considerations.

Conroy has invoked ministerial powers to issue a determination to the Australian Communications and Media Authority, specifying a class of services for which spectrum renewal would be considered in the public interest. “Licence renewal will be offered to those incumbents who are using their licences to provide services to significant numbers of Australian consumers, or have in place networks capable of providing services to a

significant number of consumers,” he said. “That means we will offer license renewal to the major telecommunications providers – Telstra, Optus, VHA and Unwired.”

However, carriers must still satisfy an array public interest criteria including consumer convenience, the promotion of highest value use for spectrum, and competitive principles; incumbents who fail to meet the public interest criteria could still find their prized spectrum up for auction.

And Conroy highlighted price as a particularly important consideration. “Licenses reissued in accordance with the public interest criteria will be subject to an agreement on price,” he said. “Accordingly, the government will seek a fee that reflects the scarcity and value of this important public resource. Renewal is not a certainty simply because a carrier services a significant customer base.”

The minister also announced a number of other planned measures designed to improve the ACMA’s ability to manage spectrum allocations (subject to proposed legislative amendments) including re-planning in the 1800MHz band; allowing two or more wireless services to share the same spectrum where ‘unacceptable levels of interference’ can be mitigated; and removing legislative blocks that stop ACMA considering licence

reissue until two years before expiry.

Australian Mobile Telecommunications Association CEO Chris Althaus welcomed the decision as “a good sign.” “Most importantly, the industry now has a level of certainty around reissuing of existing licenses to incumbent holders in the public interest. It’s a vital gate that we’ve moved through here, because at the end of the day the alternative option was to go for auction... which for incumbent license holders would have been incredibly disruptive,” he told CommsDay. “At 24 million subscriptions, it needed to be assessed on the basis of public interest, which the government has done.”

But Althaus also called for realism on renewal fee expectations. “The price that we pay for access to spectrum has a direct impact on the industry’s operating environment. And with [consultations around] 700MHz, 2.5GHz and renewal all happening at the same period of time, the government needs to be very realistic about the expectations that it places on revenue, recognising that the value – well beyond the revenue – is in the services that we provide to the economy.”

Optus’ director of corporate and government affairs Maha Krishnapillai was also pleased with the announcement. “We’re very happy to have some certainty; I think the key is the government has realised that there’s some very big productivity to be had from the sector. It’s a great result,” he told CommsDay. “The thing we’ve got to talk through now is the details – but as long as the government starts from the position that this has got broader productivity benefits for the entire economy... it’s a great start.”

And the optimism wasn’t just limited to carriers, with Qualcomm’s country manager for ANZ Rob Hart also encouraged by the decision – albeit conscious that the fine details were still to be worked through. “From our point of view, it’s good to have a minister that understands what is required,” he said.