Telefonica O2’s Czech operation has filed a lawsuit against the national regulator the Czech Telecommunication Office’s (CTU’s) upcoming 4G mobile frequencies auction, claiming that the new revised rules constitute unnecessary state interference in the way they favour a possible new market entrant. Specifically, Telefonica O2 CR is baulking at the CTU’s decision to ring-fence a block of spectrum in the 800MHz band for a newcomer, adding that it is dismayed that its previous objections to the new terms and conditions were seemingly ‘dismissed’ out of hand by the watchdog.
In March this year the Czech authorities took the decision to halt the first 4G auction, after bidding spiralled to dizzying heights prompting concerns that the high cost of licences would adversely impact on commercial launches and ultimately end-user prices. In the wake of this decision, new rules were drawn up in which the CTU reserved 2×10MHz of 800MHz spectrum for a new player, while an 1800MHz block already set aside for a new player was increased to 2×15.8MHz. However, Telefonica O2 CR argues that the high level of activity in the March auction is evidence enough that the state need not support a newcomer, noting: ‘There is at least one entity on the Czech market, which is – without any state aid – capable of entering the market as an adequate competitor to the existing operators.’ Telefónica O2 CR has, however, said that legal action need not delay the handing out of the frequencies.