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French watchdog outlines mid-band spectrum auction rules

French regulator Arcep has unveiled its plans for the 3.4-3.8 GHz spectrum auction with some pretty ambitious coverage obligations.

Although the telcos will have to wait until at least March 2020 to begin the bidding process, Arcep has shown it does pay attention to the wants and needs of private industry, including a couple of amendments from the consultation documents released in July. The main change was to increase the blocks of spectrum available in each allocation to 50 MHz.

The only piece of the puzzle which is now missing, hence the delay, are reserve prices. This is a Government decision, though many of the telcos will have fingers crossed the aggressive increase in spectrum prices is not carried through to this auction with high reserve prices.

Moving onto the coverage obligations, this is what the telcos will keeping a keen eye on. First and foremost, each telco assigned spectrum in the ‘innovation band’ will have to launch 5G in two cities by the end of 2020. Following this launch, Arcep is imposing stern demands on the number of cell sites which would have to be upgraded for these spectrum assets:

  • 3,000 by 2022
  • 8,000 by 2024
  • 10,500 by 2025

Although these targets would not get close to 100% geographical coverage, it would guarantee a pretty aggressive expansion of the 5G footprint over the next few years. On top of these coverage obligations, 25% of the cell site upgrades in the final two phases much be in ‘sparsely populated regions’ to ensure a digital divide is not created.

These coverage commitments are also extended to the road and rail infrastructure, while minimum speeds of 240 Mbps will have to be delivered on 75% of the sites by 2022. Another obligation which will be placed on the telco focuses on network slicing.

Network slicing is a key topic of discussion for all 5G enthusiasts, though rarely do the regulators include such concepts in spectrum auction obligations. Arcep has said the telcos will have to be able to offer tiered services to customers by 2023 at the latest.

While telcos rarely like being told what to do, this seems to be one of the more reasonable approaches to a spectrum auction. The reserve prices are still an unknown, but the coverage commitments are unlikely to scare any of the telcos. All eyes now turn to 2020, and the exciting part of the auction process, before Arcep moves onto the 26 GHz spectrum.

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