France Launches Tender for Fourth 3G License

Tuesday, 04 August 2009 05:37 3G

The French government has formally opened the bidding for the country's fourth 3G license, and set the reserve price at EUR 240 million (US$339 million).

As expected, France Telecom says that it will appeal against the license fee, saying that it is too low compared to the 3G license fees paid by the incumbent operators.

"Based on this price, we will launch a challenge with the commission in Brussels," said a France Telecom spokeswoman.

France Telecom is arguing that the lower license fee amounts to illegal state aid for the new entrant, although the presumed winner will be getting a smaller chunk of 3G radio spectrum and will be competing in a more developed market.

Bidders have until 29th October to submit their bids, with the license expected to be awarded around June 2010.

Iliad, the parent company of French Internet service provider Free, has confirmed that it will be a candidate for the license. A previous bid for the license by Iliad was rejected by the regulator in October 2007. Virgin Mobile France has previously suggested that it might be interested in the license as a joint venture with Numericable, and Egypt's Orascom Telecom recently said it would consider joining a consortium to bid for the license.

According to figures from the Mobile World analysts, the three incumbent operators market share at the end of Q1 '09 was: Orange (47%), SFR (36%) and Bouygues Télécom (17%)