5G — Belgium Postpones Spectrum Auction to 2020. And Maybe Later… Why? [UPDATE]

“Perhaps, the most puzzling part of the Belgian Intelligence Services report is what it does not mention. Although most countries are extremely concerned about China investments in their Telecom infrastructure, the Belgian report is silent on this issue. Why, on earth, why?”

Intel Today – December 3 2018

“Brussels has now overtaken Vienna when it comes to the density of so-called intelligence services from outside the EU.”

Peter Gridling — Head of Austria’s domestic intelligence agency (June 2018)

January 29 2019 — During the Summer 2018, the Belgian federal government announced that the auction for the 5G frequency bands would take place in 2019. Suddenly, this auction is delayed to 2020, and perhaps later. Obviously, the deadline set by the EU for the distribution of 700 MHz frequencies (also known as the ‘Golden frequency band’), set for mid-2020, could be jeopardized. What is going on? Follow us on Twitter: @INTEL_TODAY

RELATED POST: 5G — Belgian Politicians Welcome Chinese Spies… And Trash Environmental Laws

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RELATED POST: 5G — Will European Countries Ban Huawei? [UPDATE — Canada Former Spy Chief : “Ignore the threats and ban Huawei”]

UPDATE (April 2 2019) — Last Wednesday (March 27 2019), Belgium’s regional and federal governments have failed to reach an agreement on the planned auction of 5G spectrum licences.

Telecom minister Philippe de Backer said it would be up to the next administration to take the matter further. (The 2019 Belgian federal election will take place on Sunday May 26 2019, the same day as the 2019 European Parliament elections and the 2019 Belgian regional elections.)

Without an agreement by the coordinating committee, the necessary legislation cannot be implemented to organise the auction.

What is the problem? Well, officially at least, the various governments did not agree on the division of proceeds from the auction.

Auction proceeds are normally split 80 percent for the federal government and 20 percent for the regions. But one of the regional governments wants a greater share of the expected proceeds of EUR 650-700 million.

Although the story is certainly true, there is no doubt that this dispute is not the real reason for delaying the auction.

Indeed, it should be perfectly possible to launch the auction of the 5G frequency bands while postponing the decision regarding the division of the revenues.

So, what is really going on?

Well, as I have explained before, there are plenty of unknowns in this dossier such as the decision to allow Huawei equipment in the 5G infrastructure. But, in the light of recent developments, this issue seems to be under control from the point of view of the telecoms actors.

Then, there is the proposal to update of an environmental law limiting the power of GSM antennas. I have already explained the timeline of this project.

But, I also believe that the is an other major issue regarding the unexpected interest of a new operator for the 5G in Belgium.

An obscure Chinese company is rumored to be willing to bid for some frequency bands in the next auction. There is no law to prevent them from participating in the auction.

So, the Belgian government face a major dilemma. Should they organize an auction allowing four operators (the current three plus the new player) or should they organize the auction for three telecoms operators?

There is no easy solution to that one. If they decide to offer bands for only three operators, the Chinese company may very well outbid one of the current operators.

But if they decide to allow four operators, the loss of bandwidth — and revenues — for the existing operators will be very significant.

And of course, until that decision is made, there is simply no way to organize the auction.

END of UPDATE

In a story posted on December 3 2018 (Belgium — Chinese Espionage Is Clear and Present Danger), I told you that I was flummoxed by the silence of the last Belgian Intelligence agency report. Here is what I wrote:

“Perhaps, the most puzzling part of the report is what it does not mention.

Although most countries are extremely concerned about China investments in their Telecom infrastructure, the Belgian report is silent on this issue.

Why, on earth, why?”

On December 7 2018, two Belgian Newspapers (L’Echo and De Tijd ) revealed that the Belgium Centre for Cybersecurity (CCB) was considering the possibility of banning Huawei from Belgium.

The CCB has requested, through both national and international channels, objective studies showing that the use of Huawei technology carries risks, before being able to send out detailed advice.

I understand that the CCB has now recommended to ban Huawei from the Belgian 5G infrastructure.

On January 9 2019, I told you that Proximus — who has long been planning to deploy a 5G network in partnership with Huawei — has forced the Brussels government to trash a basic environmental law limiting the power of the telecom antennas.

“The Minister of Environment is rushing a new law (ahead of the next general elections scheduled for May 26 2019) that will allow telecoms operators to emit  about 10 times more radiation.

Guess what? It only gets better…

Like most European countries, the Belgian government had announced that the 5G auction would take place during in the spring 2019.

The full text of its proposal to auction 20-year  licences for frequencies in the 700MHz, 1400MHz and 3600MHz bands has been published.

Moreover, the auction will also cover the renewals of existing spectrum licences for 900MHz, 1800MHz and 2600 MHz bands which run out in March 2021.

The government expects to raise at the very least €680 million from this auction.

And suddenly… Michel Van Bellinghen — President of the Council for the Belgian Telecommunications Regulator, also known as the IBPT —  told Belgian media that:

“The prospect of being able to reasonably organize these current 2019 bids in the right conditions is becoming ever increasingly remote.”

Better! Out of the blue, Philippe De Backer — the Belgian Minister for Telecommunications — announced that this auction is delayed to 2020, and perhaps later.

Why on earth, why?

As always, there is no lack of explanations..

“The delay has been caused by the failure of the Regional Government Consultative Committee not being able to reach consensus on how the proceeds from the auction should be allocated.”  [Telecom Minister Philippe De Backer]

But Belgian financial newspaper L’Echo has another explanation. The Brussels environmental law seems to be the issue…

While others argue that Proximus is fighting the Belgian government willingness to open the market to a fourth Telecoms operator…

Analysis

Here is my take on this issue. I wish to emphasise that I have not insider information. It is not even RUMINT or GOSINT, just pure ‘guesstimate’ on my part… Hear me on.

As I told you, we KNOW that the Brussels Minister of Environment has announced that she was rushing a new law (ahead of the next general elections scheduled for May 26 2019) that will allow telecoms operators to emit  about 10 times more radiation.

“This decision is not just puzzling — considering the recent findings clearly linking GSM to cancer — but also illegal as this new law clearly is idiotic and violates an article of the Constitution.

Such decision is almost certainly politically suicidal. What is going on?”

I have already explained that the Belgian Federal and Regional governments have long provided Proximus — the leading Belgium Telecoms operator — with an advantage over their competitors.

This is not very difficult to understand. The Proximus Group is primarily state-owned, with the Belgian state holding 53.3%.  The group’s main current competitors are Telenet and Orange Belgium.

But now, the Federal Government would like to use the opportunity of the 5G frequency auction — as well as the renewal of all existing 2G, 3G and 4G bands — to introduce a fourth telecoms company in Belgium.

In the light of the above, you will not be surprised that the cost of telecoms in Belgium is higher than anywhere else in Europe.

Thus, you can easily imagine what will happen if a fourth player is allowed…

So far,  so good…

However, there is just a small glitch… The rules of the game are quite fuzzy. As I told you before, many politicians — and two dozens of public servants — have colluded with the Telecoms Industry to ‘bypass’ critical environmental laws over the last ten years. The evidence, I must add, is incontrovertible.

So, let us suppose that a fourth player is ready to move in. Surely, this actor wants to know the rules of the game. After all, nobody invests around one billion not knowing the risk…

In short, what are the Belgian laws? Now, we hit the nerve.

If the Brussels Minister of Environment introduces this moronic law just ahead of the general election of May 2019, there is a major uncertainty for rational players.

Not everyone in Belgium is a complete idiot. Surely, some concerned citizen will challenge the legality of this law before the Supreme Court. And that person has six months to do so… We are now in November 2019.

The Belgian Supreme Court will answer 12 months later, sometimes even a bit later. That brings us in November 2020, and more likely in early 2021.

Bingo! Finally, things are making just a bit of sense… Then again, this is just my two cents.

PS: In a recent post, I also told you that these politicians and public servants have hidden a very sophisticated espionage operation conducted in Brussels by a non-friendly intelligence agency against US interests. I think this one is being taken care of.

REFERENCES

Belgian 5G auction pushed back to 2020 — TeleComparer

Belgium postpones 5G spectrum auction to 2020 or later  — Mobile Europe

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5G — Belgium Postpones Spectrum Auction to 2020. And Maybe Later… Why?

5G — Belgium Postpones Spectrum Auction to 2020. And Maybe Later… Why?  [UPDATE]

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