A new report from the Arab Advisors Group has analysed the cellular spectrum acquisition fees in nine countries: Algeria, Bahrain, France, India, Jordan, Oman, Saudi Arabia, South Africa and UK. The research revealed that Jordan had the highest annual acquisition fees for spectrum bands in 800, 900, 1800, 2100, 2600 MHz. Jordan’s highest prices were followed by those in France, the UK and Algeria.
Spectrum usage fees are fees paid by the mobile operators in order to acquire a specific bandwidth of frequency on a specific band and utilize this bandwidth in offering its services through different technologies. Their value is therefore highly dependent on the economic conditions of each country and the telecom sector’s current and potentially profitability.
“The Arab Advisors Group’s study analysed the cellular spectrum acquisition fees for the frequency bands of 800, 900, 1800, 2100 and 2600 MHz. Moreover, it presented the findings using the Annual Price/MHz-POP, which is the effective annual fees paid by the operators for one MHz of spectrum to serve the country’s population. Based on Zain Jordan’s latest spectrum acquisition and Orange Jordan’s license renewal, our study revealed that Jordan had the highest acquisition fees on the 900, 1800 and 2100 MHz bands amongst the countries analysed,” Zaid Ghaith, Arab Advisors project manager, said.
“The Arab Advisors Group believes that setting frequency fees at very high and, even, unreasonable costs would certainly hurt the prospects for future investments in the sector. High frequency fees squeeze funds that could have gone into expanding networks infrastructure and also lower the profitability of the telecom operators, hurting both consumers and investors,” Jawad Abbassi, Arab Advisors Group’s founder and general manager, explained.
“Governments use different pricing models to calculate the spectrum prices, some countries use formulas, others use a fixed price per MHz and most countries hold auctions and set reserve prices.” Zaid Ghaith, Arab Advisors project manager, added.