Also on Monday, the Czech government is likely to approve a proposal on allocating UMTS licenses, according to Deputy Finance Minister Mladek. The proposal envisages giving three UMTS licenses to existing cellular operators for a fixed fee and awarding a fourth one to a newcomer in an auction (though earlier statements by other officials suggested that the fourth-license tender would be a beauty contest). Regardless of the form of the fourth-license tender, such a solution would, in our view, be relatively favorable for the three incumbent operators (both Ceske radiokomunikace and Cesky Telecom have a cellular subsidiary). The fixed price that the incumbents would pay has not been suggested, but the 2001 budget envisages CZK 20 bil. revenues from UMTS licenses, implying some CZK 5 bil. (USD 125 mil.) for each license. The licenses should be awarded next year.
(Ondřej Daťka)