How (Not) to Run Auctions: The European 3g Telecom Auctions

Abstract

There were enormous differences in the revenues from the European "third generation" (3G, or "UMTS") mobile-phone license auctions, from 20 Euros per capita in Switzerland to 650 Euros per capita in the U.K., though the values of the licences sold were similar. Poor auction designs in some countries facilitated collusion between firms and failed to attract entrants. The sequencing of the auctions was also crucial. We discuss the auctions in the U.K., Netherlands, Germany, Italy, Austria, Switzerland, Belgium, Greece and Denmark.

Keywords: Auctions, Telecommunications, Spectrum Auctions, 3G, UMTS, Bidding

JEL Classification: D44, L96