Feature Article

September 25, 2012

European Telecoms Spend Big on Romanian Mobile Telephony Licenses

The fight over control of the airways, especially when talking about VoIP and other telephony services, can be a bitter one. Real money can be made when telephony licenses are up for grabs and that is why several European telecoms are willing to pay top dollar in order to secure Romanian mobile telephony licenses. 

Ancom, Romania’s telecom market agency announced earlier this week that Cosmote, Orange, RCS&RDS, Vodafone and 2K Telecom will pay a combined $885.21 million for telephony licenses covering the frequency bands 800 MHz, 900 MHz, 1.800 MHz and 2.600 MHz.

The five telecoms will now own approximately 85 percent of the Romanian market with the purchases and these licenses will be effective from April 6, 2014 to 2029. It is certainly not uncommon for governments to afford a large section of years for these licenses to be effective especially when talking about the massive amount of money that is changing hands in these types of deals. 

All sales of the telephony licenses were conducted using an auction style with Vodafone Romania being the biggest spender after doling out more than $295 million for their share of the licenses. Orange Romania came in a close second, paying more than $292 million for their licenses. 2K Telecom was the thriftiest shoppers of the five telecoms, spending just over $7 million.

The telephony licenses that Ancom auctioned off were separated into 42 license blocks that covered a wide range of frequencies. The money that was paid was perhaps interesting only because Romania is hardly known as the tech center of Europe when it comes to smartphones or telephony in general. Despite that, several branches of some of the biggest telecom companies in Europe were more than happy to make sure they had secured the rights to do business in the country over the next quarter of a century.

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Edited by Brooke Neuman

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