Press Releases

Connect Austria awarded third GSM licence for 2.3 billions AS

500 jobs to be created in the next ten months -- Anticipated investment volume: 6.5 billion AS


To avoid further delays in granting the license, Walter Ressler, Chief Executive of RHI (Radex Heraklit) and lead manager of the Connect Austria consortium, and Austrian Secretary of Transportation and Communications Caspar Einem agreed on a license fee in the amount of 2.3 billion AS. According to an Austrian Transportation Department news release, this agreement was reached after an overnight bargaining session held last night (Thursday night until this morning) at the Secretary4s vacation retreat.
In addition, the consortium pledged to create 500 new jobs within the next ten months and an additional 500 over the next few years. The anticipated investment volume of more than 6.5 billion AS will contribute indirectly to the creation of an additional 2,000-3,000 new jobs over the medium term.
According to the press release, the difference in comparison to the fees paid by the two existing operators, Mobilkom and max.mobil., resulted primarily from the increased expense of the DCS 1800 technology and from the delayed market entry. As reported, the then two consortia Connect and Orange each offered approx. 1 billion AS in license fees when the bids where submitted. max.mobil. and Mobilkom each had to pay 4 billion AS in license fees.
With regard to the lower fee for the present license, the Transportation Department noted that there had been further worsening in the situation for the third market participant due to the dramatic drop in mobile telephone service rates over the past few months (triggered by tough price competition between Mobilkom and max.mobil.).