Irish Eyes Smile at Hutchison
Vodafone Group PLC (NYSE: VOD) and mmO2 PLC (NYSE: OOM) had better sharpen up their license application skills after losing out to Hutchison Whampoa Ltd. in the race for Ireland's top 3G license (see Hutchison Bags Irish 3G).
Hutchison 3G Ireland Ltd., wholly owned by the Hong Kong conglomerate, now has five days to decide whether it wants the coveted "License A" or not. If it accepts, its rivals, which already have GSM operations in the country, pick up the "B" licenses for which they also applied.
Unstrung will eat its SIM card if Hutch pulls out. The license requires 80 percent population coverage. Ireland has fewer than 4 million people, nearly half of whom live in about 20 towns and cities.
And the prices of the 20-year licenses are not quite in the same league as those in the U.K. and Germany. License A costs just over €50 million (US$49 million), while the B licenses cost €114 million ($111 million) apiece. We would call this "small potatoes."
Why did Hutchison get the nod? Apparently its submission was "strong on promotion of competition, MVNO access, and quality of service." Fair enough, if that's what you're looking for!
Whilst Hutchison celebrates with a Guinness or twenty, its rivals and the regulator drown their sorrows. Vodafone and O2 get lumped with less spectrum for which they pay more money, and the regulator rakes in less cash than planned: It still has a B license going spare.
— Ray Le Maistre, European Editor, Unstrung