In a situation where almost everyone, including young schoolchildren, has a mobile phone, ideally smart, the auction of frequencies for 5G networks is much more than just a professional topic. It is a society-wide issue.
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But not because we would not be able to do without fifth-generation networks immediately, as their evangelizers tell us. But because we promised the fourth operator to solve the problem of expensive and insufficient mobile data.
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Their price (the prices of calls are hardly of interest to anyone) can be viewed from two angles. Some people don’t mind that they get little data for the price they pay. For others, the amount would be enough, but he cannot afford or does not want to pay such a large amount. In both cases, the price per gigabyte of mobile data is high in consumers’ perceptions and operators do not offer an adequate tariff for either.
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Politicians have noticed a burning problem in recent years and have begun to race over who can provide cheap mobile data. There are several ways to do this. The Czechia has taken a single direction: it has joined forces with the arrival of a fourth mobile operator in the hope that it will offer very cheap tariffs with large data volumes in the fight for customers.
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Which could easily have worked. The current three operators would reduce the prices of their own tariffs and blow up data volumes in an effort to prevent their customers from escaping to new competition. However, this would also prevent the new fourth player from earning a demanding initial investment and having a reasonable return on investment plan. The new mobile network is an extremely expensive and administratively demanding thing – not least due to complex construction legislation.
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T-Mobile, O2 and Vodafone already have their network paid for. Instead of five billion a year, they can pay four in dividends without hurting anyone significantly. The new operator, on the other hand, would be under incredible pressure to meet the conditions of auction coverage in the Czech legislative environment, with the prospect that the legal and official framework is constantly changing.
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Without cooperation with one of the current telecommunications companies, without the possibility of renting places on poles and optical cables to them, it would probably not be possible at all. Let’s omit the fact that there are not optical cables everywhere and for real 5G they will need much, much more.
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Thus, existing mobile operators always had stronger cards in their hand and could properly flood a potential new player. Or he would have to go to their hands, at least in part. In addition, he would constantly fight the state bureaucracy.
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Nevertheless, there was a chance for the arrival of a strong fourth mobile operator. For example, the problem could have been approached in the same way as any assembly plant in the past: the state could have lured a strategic bidder with a strong investment incentive. Offer him tax holidays, subsidies for highly skilled jobs, and where possible, protect him from the current mobile troika and state bureaucracy. All this in exchange for the promise of affordable services, for example for selected social groups, and also for the fact that it will have its headquarters in Brno or Ostrava, where it will work closely with local technical universities and colleges.
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Everyone would make money on it. The state and the regions by supporting highly qualified jobs that would be linked to other services, or by better connecting the academic and commercial world. The selected social groups would help each other with cheap tariffs, but a little later also everyone else, until the market adapted to the new price level.
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This can certainly be criticized from the point of view of interventions in the economy and in the competitive environment. But it would certainly not be the first or last time the state has done such a thing.
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But it all didn’t happen in short and well anyway. Neither the Prime Minister nor Minister Havlíček, nor even a special government commissioner, held any roadshows with potential strategic telecommunications partners abroad and subsequently did not start exclusive negotiations with a few selected candidates.
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It would definitely not be an easy task. But it would be achievable if someone at the highest political level really took care of it and if political PR was not addressed in the first place around the fourth operator. It is difficult now to blame the Czech Telecommunication Office for the result of the auction, from which the fourth operator did not really emerge and will not emerge.
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The state lacks a long-term strategy in the development of telecommunications. Due to the conditions of the auction, which we have had the opportunity to read in several variants over the last two years, another result could not be expected.
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In fact, it is also completely wrong that the task of bringing the fourth operator to the Czech market falls on the back of the Czech Telecommunications Office. It is intended to regulate the existing market, not to determine state or government strategy. This is to be done by the government and through the Ministry of Industry and Trade it is to be enforced, through the CTU then “only” to guard and fulfill.
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In the case of the 5G auction, the Ministry and the Telecommunications Office simply fulfilled the government’s non-existent strategy as best they could. But the government is obviously satisfied – the formal task has been completed, the money for the budget will be, the telecommunications market will somehow cope and customers will continue to wait for cheap mobile data.
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You will now have to choose a different path to them. It doesn’t have to be just a fourth mobile operator. Reasonable wholesale conditions for virtual operators can play a role. For example, in Austria, where there are only three network operators, but a lot of virtual ones with much cheaper data than in our country. And so we somehow suspect that a little higher Austrian salaries and much higher Austrian mountains make the construction of mobile networks more expensive compared to the Czech “specific market”.
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Or the government can sit down with today’s telecommunications big three and ask how it can make it easier for it to operate – how it can simplify the construction of mobile networks and optical lines, provided that the savings (financial and time) are reflected in prices for end customers. For example, government agencies may stop buying mobile services at ridiculous prices, which are paid for by those who pay according to the price list as a result – which are often the weakest social groups. Again in exchange for prices falling.
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It doesn’t have to be a jump and it doesn’t have to be right away. A long-term plan would be enough, as we have seen at European level to reduce roaming charges. Do you remember? It was a cry across Europe that operators would be surprised about a begging stick and would not have to invest. Today, roaming prices are the same as prices at home, and this has not had a visible effect on the financial health of large telecoms. On the contrary, they innovate and invest.
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But this is again in need of the government’s strategic approach to telecommunications services and their long-term development. Somehow we suspect that we can’t expect anything like that in the near future. And quite fairly, the government has and will have other concerns. But this strategic gap should not fit.
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However, customers can now contribute even more to cheap data than the government, the Ministry of Industry or the CTU. They should talk loudly about mobile data. And they should change operators more than ever before. It’s really very easy today. It doesn’t matter that they won’t get much better conditions than they had before. This will move the market.
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Mobile operators will feel the opportunity, and just as they can sell you an unnecessary cheap Chinese tablet and an unnecessary tariff for you when replacing a SIM card at the store today, they will always offer agitated customers a little better service than they had before.
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If a large mass of customers is set in motion, the offers will be adjusted.
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Mobile data prices have fallen in recent years, but it’s not as horrible as it used to be. This is far from it, but the trend is clear. And when customers learn to know their rights, insist on them and do not take disadvantageous offers, on the contrary, they will clearly formulate their idea and negotiate, so existing mobile operators will adapt to them. Although this does not look like the internet, they are not the enemies of consumers. They simply take advantage of the fact that the Czech consumer lets himself like everything.
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Forget about the fourth operator, the auctions and that someone will arrange cheap mobile data for you. As with almost everything, you have to start doing something yourself first.
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