NCC to monitor 4G bids on overheating concerns

By Shelley Shan  /  Staff reporter

Thu, Sep 26, 2013 - Page 3

The National Communications Commission (NCC) yesterday said it had yet to decide whether to lower the percentage of increases in the bids for fourth-generation (4G) telecom licenses, adding that it would closely monitor each round to see if further action should be taken.

The auction, which began on Sept. 3, has attracted NT$64.79 billion (US$2.2 billion) in bids as of yesterday. It has already exceeded the floor price of NT$35.9 billion set by the NCC before the bidding had begun.

Many have warned that telecoms will overspend on a 4G license, which would in turn drive up their operating costs. Fearing that consumers could end up paying more for a 4G service, some have urged the commission to reduce the percentage increase in the bidding price to cool the auction.

To prevent the bidding from getting overheated, the commission has set a rule that the increase of the bidding price in each round can only be between 3 percent and 7 percent of that in the previous round.

In response, National Communications Commission spokesperson Yu Hsiao-cheng (虞孝成) said that the commission had discussed the issue at a meeting and found it unnecessary to reduce the percentage increase in the bidding at this point.

“The carriers’ operational costs would certainly increase if they spend too much on a license, but they also have to take into consideration their operational strategies and target customers, as well as other factors, when they bid. We will watch the results of each round closely,” Yu said.

Meanwhile, Democratic Progressive Party legislators Lin Chia-lung (林佳龍) and Liu Chao-hao (劉櫂豪) hosted a press conference yesterday morning, saying that the government should use the funds received from the 4G license auction to invest specifically in the building and maintenance of a broadband network to minimize the digital gap between urban and rural areas.

Yu said the commission welcomed the proposal, but added legislation covering the broadband network would need to be passed by the legislature.