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To: Rono who wrote (9554)	1/15/2000 11:34:00 AM
From: Rono	Read Replies (1) \| Respond to of 10227

13 Sign Up for U.K. 3G Auction By Vanessa Clark 12 January 2000 The U.K. auction of third generation mobile licenses got underway today with thirteen companies applying to bid. But even as the hopefuls each handed over the 50 million pound ($82.3 million) deposit needed to book a place in the auction, consultancy Schema warned them that they are gambling by investing so much in a technology no one knows how to make money out of yet. The U.K.'s Department of Trade and Industry confirmed that the following thirteen companies have applied to bid. The four incumbent network operators: BT (3G) Ltd, a subsidiary of BT. One2One Personal Communications Ltd. Orange 3G Ltd. Vodafone Ltd. And nine potential new entrants: 3G (U.K.) Ltd, a subsidiary of Irish Eircom. Crescent Wireless Ltd, a new company formed by Global Crossing shareholders. Global Crossing has an option to buy the company. Epsilon Tele.com plc, a wholly-owned subsidiary of Japanese finance house Nomura, which plans to lease the license to a third party if it wins. NTL Mobile Ltd, jointly owned by NTL and France Telecom. One.Tel Global WIreless Ltd, a subsidiary of Australian One.Tel. SpectrumCo Ltd, formed by the Virgin Group, Nextel, Sonera, EMI, Tesco and a number of private equity funds. TIW UMTS (U.K.), a subsidiary of TIW the owner of Tetra operator Dolphin. Telef¢nica U.K. Ltd, a wholly-owned subsidiary of Spain's Telef¢nica. WorldCom Wireless (U.K.) Ltd, owned by MCI Worldcom. A DTI statement said it will name the applicants which qualify for the auction, and the date of the auction in February. Reserve prices for the five licenses total 500 million pounds, according to the Ministry. The government will auction five third generation licenses over the next few months, with at least one license reserved for a newcomer to the U.K. mobile market. The licenses will allow operators to offer new multimedia-based mobile services like downloading video clips and e-commerce transactions using higher data rates than currently available on second generation networks. But, just as important, is the additional wireless spectrum the operators will receive. While Schema Director, Alan Pyne, does not deny the importance of getting the licenses, he says "operators should be cautious about predicting [3G] will change the world." He says there are still uncertainties about how 3G services will be charged for and just how customers are going to use the service. He also advises operators to compete with fixed services on voice only and to see mobile data as "an enhancement of the fixed offering." Pyne predicts that the four existing U.K. operators will almost certainly win a license each. Of course, Vodafone Airtouch's hostile bid for Mannesmann, which owns Orange, has complicated matters. The government said last month that the final decision on this has been left to the discretion of the secretary of state. Pyne's favorite for the newcomer's license is U.K. cable operator NTL, which is 25%-owned by France Telecom. The French operator is also said to have its eye on Orange if Vodafone snaps up Mannesmann. "The new entrant has an uphill task ahead of them to win marketshare," said Pyne. By the time 3G networks and services get off the ground in a few years, the incumbents are expected to have captured 60% of the U.K. mobile market. NTL has the advantage of an existing cable subscriber-base in the U.K. over a complete newcomer, said Pyne.