Telco primed for spectrum bid

PRIMUS Telecom could enter the mobile telephony market if the spectrum the federal government has identified as having potential commercial value goes under the hammer.

Primus Telecom chief executive Ravi Bhatia said the spectrum would provide an attractive opportunity to enter the mobile market in Australia and that he would consider seeking approval from Primus’s offshore parent to enter a bid.

“I’d personally very much like to, but let’s see when it’s released whether we can, of course, prepare internal business cases and get approvals from the board and move forward,” mr Bhatia said.

“I’m talking in conceptual terms, not in business terms. No commercial decisions have been made. what I’m telling you as a telco professional is that it would be very attractive to bid for spectrum to be in the wireless game.”

The network would be based on the 4G Long Term Evolution (LTE) standard, mr Bhatia said.

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He said current wireless networks would rapidly become congested this year as younger demographics streamed more video content to iPhones and other popular handsets.

The situation has prompted mr Bhatia to doubt the shelf life of other emerging terrestrial broadband entertainment services, including IPTV and set-top boxes. Demand for online video was shifting to “small screens”, he said. “We don’t know which way the market is going to lean. We have our set-top box solution as well but I’m personally very sceptical that’s the direction to go to. look at the way consumers are using (online video) today — consumers want to watch video whenever they want it, wherever they are and whatever they want.

“Not all those three conditions are met by the set-top box solution.” He said the future shape of set-top boxes was also “indeterminate” due to the growing availability of similar functionality, including movies and personal video recording, in popular game consoles including the Xbox 360 and Sony’s PlayStation 3.

The number of mobile network operators in Australia shrunk from four to three after Vodafone Australia and Hutchison 3 merged last year to form Vodafone Hutchison Australia (VHA). Telstra and Optus operate the remaining two 3G networks. Primus has been reselling Optus’s 3G network for its mobile broadband product since August 2008 under the brand name Speedster.

However, the means to build a new mobile network would be unlikely to arrive earlier than 2013, when the federal government plans to auction a 126MHz tranche of spectrum in the 600MHz to 800MHz band, currently used for analogue free-to-air broadcasting. the government has also identified another tranche of about 200MHz in the 2.5GHz frequency range currently used for electronic news gathering that could be auctioned. it has released a discussion paper on the potential use of the 2.5GHz spectrum, but plans for its re-use are less advanced than for the free-to-air spectrum.

The spectrum allocation re-shuffle has been prompted by the emergence of digital spectrum, which is more efficient than the older analogue technology.

Telco primed for spectrum bid