Vodafone Malta, Mobisle Communications (Go) and Melita Mobile have applied to obtain frequencies in the 900 MHz and 1800 MHz frequency bands used for mobile communication services.

Last year the Malta Communications Authority issued a call for applications to re-assign the frequency bands as the rights of use of these frequencies enjoyed by Vodafone Malta and Go, between them covering over 90 percent of the market, expired last year. These were extended till next March when the re-assignment process should have been concluded.

The call for applications was open to anyone and not just the incumbents, however it was expected that only the current operators would be interested in the frequencies, as three national mobile network operators are considered more than enough for a small market like Malta’s.

Indeed one of the current rights holders, Telepage Limited, did not re-apply for the frequencies. It did not even provide a commercial public mobile telephony service and its rights expire in March 2011.

The 2.1 GHz band, also used for mobile telephony, was assigned to Melita in 2005 following the UMTS 3G spectrum assignment process, which also granted rights to Vodafone Malta and Go Mobile in that band. This particular band is not affected by this spectrum re-assignment exercise for the 900 MHz and 1800 MHz frequencies. However, Melita Mobile applied for frequencies in these two ranges and this means it wants to expand its network and become a tri-band player, possibly at the expense of the other two operators in terms of frequencies.

The call for applications established that applicants must first go through a qualification stage that will ensure that successful applicants have the necessary standing to establish and operate state of the art networks and fulfill the licence obligations. Given that Malta’s three established operators, one of them established for the last 20 years and another for the last 10 years, have been a commercial success, it is envisaged that all three applications should qualify for the final stage.

If the demand exceeds supply the MCA will meet the applicants and try to reach an agreement. If this fails, then an auction will be held. The final outcome will ultimately depend on the value the applicants place on the spectrum, the authority explained.

The authority emphasised that the assignment of spectrum is based on a set of fundamental principles. For example spectrum is a limited national resource and must be used carefully and operators have time-bound rights of use of spectrum and not ownership.

Since the early 1990s these bands were earmarked at an international level for the provision of mobile communication systems, with the GSM standard being undisputedly the most popular technology deployed in these bands. Over the years, numerous technological developments have given mobile operators the possibility to offer, over these bands, not only voice and data services, but also innovative multimedia services such as video streaming.

The companies assigned the frequencies will have to pay the Maltese government €224,000 for every 5 MHz block. The new fee structure as well as the channeling plan are totally different from the current ones expiring right now. The MCA reassured that market-based prices for this spectrum being paid in other countries was taken into consideration along with the fees paid for other bands capable of offering similar services, such as the namely UMTS (3G) 2.1 GHz band spectrum.

The latest statistics by the MCA show that at the end of June 2010 Vodafone Malta was the leader with 48.55 percent of the market, followed by Go Mobile with 42.79 and Melita Mobile with 6.73. Redtouch Fone, the small operator that uses the infrastructure of a larger operator, stood at 1.93 per cent.

Last year the former chief executive officer of Vodafone Malta, Iñaki Berroeta, had shared with i-Tech his reservations over the commercial viability of three national mobile operators in Malta. This echoed the opinion expressed by other parties a few years ago when the 3G mobile licenses where in the process of being awarded.