June 29, 2011 / 8:46 AM / 9 years ago

Spain kicks off auction of mobile licences to 2030

* 11 participants to join electronic bidding

* New licences seen having limited impact on top operators

By Sarah Morris and Robert Hetz

MADRID, June 29 (Reuters) - Spain will kick off its first- ever auction of mobile telecoms licences on Wednesday in an internet contest the government hopes will generate at least 1.45 billion euros ($2.05 billion).

Eleven telecoms operators applied and were granted the right to enter the auction, crucial in distributing enough mobile frequencies to allow operators to meet future customer demand for data use on smartphones and tablets.

The bidders with the most firepower are likely to be Spain’s largest mobile operators, ex-state monopoly Telefonica , Vodafone and France Telecom’s Orange , which together now have more than 90 percent of Spain’s mobile market.

Allocation rules will limit the total amount operators can have in each frequency, but most analysts expect the overall new distribution to have a limited impact on the largest players as few competitors are seen as having enough to invest in buying licences and committing to expensive infrastructure rollout.

“We do not believe that the Spanish spectrum auction will lead to major changes in the competitive environment in the Spanish mobile market,” Caja Madrid Bolsa said in a client note.

Cable operator ONO, Spanish telecoms provider Jazztel and regional operators like Euskaltel have shown interest in mobile licences so they can offer more customers mobile services without having to rent competitors’ networks.

The participants will bid for blocks of frequency, with up to 10 blocks being auctioned per day and 58 blocks up for sale, including some regional licences. The duration of the auction will depend on the competing bids entered. ($1=.7062 Euro) (Editing by David Holmes and Jon Loades-Carter)

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