The Spanish government has finally acceded to operator demands and applied a 15 percent reduction to the starting price of 5G frequencies in the 700 MHz band, according to the bidding conditions for the corresponding tender published in the country’s official gazette. The total starting price for the seven blocks of frequencies has been cut from around EUR 1.2 billion to EUR 995 million, not quite as low as Spain’s operators demanded, although the duration of spectrum licences has also been extended from the previous limit of 20 years to 40 years to give operators more time to write off their investment.
The government was intending to auction off the frequencies this month following several delays due to the Covid-19 pandemic, but will now hold the tender no later than 21 July, with operators given until 02 July to submit their applications. A total of seven blocks will be offered between 703 MHz and 788 MHz via a secure electronic auction system. Vodafone, Movistar (Telefonica), Orange and Masmovil are all expected to submit bids, although Masmovil recently asked for a further delay to complete its takeover of Euskaltel.
Coverage obligations have also been relaxed, with the operators required to cover 450 localities by the end of June 2025, including 30 percent by the end of 2022, rising to 70 percent by July 2024. The country’s largest airports and motorways must also be covered with the 700MHz network.
Vodafone was the first Spanish operator to switch on its 5G signal on the 3.5 GHz band in an initial 15 cities back in June 2019, followed in September 2020 by Telefonica, Orange and Masmovil, all of which use DSS (Dynamic Spectrum Sharing) equipment that can operate with 4G and 5G at the same time. However, the 700 MHz band is considered key for the rollout of SA (standalone) 5G when the technology becomes fully available after standardisation.
