Global Insight Perspective | |
Significance | The Electronic Communications Office (UKE) has selected a privately owned company, Centernet, as the winner of the tender for the 1800 MHz frequencies. |
Implications | The tender stipulates that the 1800 MHz frequencies can to be used to construct a public telecoms network for mobile and fixed-line telephony, as well as radio internet access. |
Outlook | Centernet is set to become Poland's fifth mobile operator. It will also be able to utilise the frequencies for wireless broadband internet access, competing against ADSL and WiMAX technologies. |
Poland's telecoms market regulator, the UKE, has awarded the two remaining frequency bands in the 1800 MHz spectrum (1710-1730 MHz and 1805-1825 MHz) to Centernet, a company affiliated with investment fund NFI Midas, which is 70%-owned by local private investor Roman Karkosik, renowned for his stock market investments. Centernet will pay 372.92 million zloty (US$140.14 million) for the 15-year licence, which will facilitate the winner's operations in the mobile, fixed-line telephony and broadband internet segments nationwide.
It was the UKE's third attempt to auction the remaining two frequency bands in the 1800 MHz spectrum. In the first tender, the bidders failed to attract the required number of points, while the second tender produced a winner: Telekomunikacja Kolejowa, a telecoms unit set up by national railway operator PKP. The company bid 510 million zloty for the licence, but finally withdrew its plans due to high roll-out costs. The third tender was announced in May this year and attracted five bidders, including the three existing mobile operators, PTK Centertel, Polkomtel and PTC, as well as three newcomers, Centernet, Tolpis and Inquam Broadband (see Poland: 27 August 2007: Six Bidders Submit Offer for 1800 MHz Frequencies in Poland and 17 April 2007: Polish Regulator Plans GSM 1800 Tender in May).
Outlook and Implications
Roll-Out Plans: Centernet received the country's fifth mobile network operator licence. Initially, the company plans to use the network of one of the existing mobile operators under the domestic roaming rule. It also intends to launch its own infrastructure in the middle of 2008. Centernet will invest between 0.7-1.0 billion zloty in its network roll-out and information and communication technology (ICT) systems. The company is also open to joining forces with a financial investor for the project. According to its business plan, Centernet will operate under two brands. The Extreme Mobile brand will target young professionals in the country's major cities, while the other—the brand name is yet to be revealed—will take aim at the lower-end segments of the market.
Mobile Market: Centernet, which will enter the market as the fifth mobile network operator, is targeting 2.5 million users in the next five years. The entry of Centernet will bring a new wave of competition, which intensified following the arrival of the fourth mobile player, P4, in March this year, as well as the country's first MVNOs. At the end of July this year, market leader PTK Centertel attracted 13.056 million customers on a 33.8% market share, Polkomtel had 12.917 million subscribers on a 33.4% market share, and third-placed PTC had 12.525 million users on a 32.4% market share. The fourth mobile player, P4, attracted 172,000 users, achieving 0.4% market share. It targets 730,000 customers, or 5% of net new mobile additions in Poland, by end-2007 (see Poland: 30 August 2007: Play Exceeds Customer Growth Expectations).