Record haul in Itay's WiMax auction

The auction of 35 WiMax licences in Italy has broken European records by raising €136.3m (£104.4m), as the government plans using the wireless technology to plug the country's broadband internet black spots.

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The auction of 35 WiMax licences in Italy has broken European records by raising €136.3m (£104.4m), as the government plans using the wireless technology to plug the country's broadband internet black spots.

Communications Minister Paolo Gentiloni announced last week that the ninth round of WiMax bidding had concluded with a 176 percent increase on the starting offers.

The biggest winner was the relatively little-known AriaDSL SpA, which secured licences in all Italian regions for €47.5m (£36.5m). The company is reportedly controlled by an Israeli billionaire, David Gilo, who's also the founder of US-based broadband wireless company Vyyo.

The second-biggest spender was Italian Wi-Fi provider AFT SpA, which paid €34.4 million (£26.3 million) for licences across the country. The former telecommunications incumbent Telecom Italia snapped up licences in central and southern Italy for €13.8 million (£10.5 million).

Former Prime Minister Silvio Berlusconi’s Mediaset group, Wind and Fastweb were among the major players to pull out before the auction's conclusion.

WiMax (Worldwide Interoperability for Microwave Access) 3.5GHz radio frequencies were previously used for military communications. Their public auction is intended to combat the digital divide in Italy and encourage the entry of smaller companies into the telecoms market.

The technology delivers speeds of 3Mbit/s to 5Mbit/s per second for downloads and 1Mbit/s to 1.5Mbit/s for uploads. It's considered ideal for bringing mobile broadband communications to remote rural and mountainous areas.

Some 4.2 million Italians, or 7.5 percent of the population, are still cut off from broadband internet access, according to the Communications Ministry. The terms of the WiMax auction obliged bidders to explain their plans for introducing the technology to the country’s internet black spots.

"The market geography to emerge from this auction is extremely positive, because it shows we have competition, a significant number of players and sizeable investments," Communications Minister Gentiloni said.

WiMax auctions in France and Germany recently raised €125.8 million (£96.3 million) and €56.1 million (£42.9 million), respectively. Italy’s licences run for 15 years.

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