Frågor och svar om tilldelningen i 900-, 2100- och 2600 MHz-banden

According to the example a bidder can submit one bid for C1 (e.g. in the interval [190,200]) and one separate bid for C2 (e.g. in the interval [190,200]).

Suppose the bidder has won 110 MHz across the 2100/2600FDD/2600TDD bands in the clock stage of the auction.

Question: We assume the bidder can submit the two bids described above, even though the bidder cannot win both (otherwise spectrum caps would be violated, ref 4.3.2).

If this is not the case, please clarify.

Answer

In accordance with Section 4.3.2 in Open Invitation part 2, the bidder cannot bid for more than allowed by the spectrum cap; therefore, the bidder can submit one exit bid on either lot (C1 or C2) but not on both, in order not to violate the spectrum cap.

Svar

I enlighet med avsnitt 4.3.2 i Allmän inbjudan del 2 kan budgivaren inte bjuda på mer än vad som tillåts enligt spektrumtaket. Därmed kan budgivaren lägga ett utträdesbud på endera ett block i kategori C1 eller C2, men inte på båda. Detta för att inte bryta mot spektrumtaket.

Suppose there are two lots for sale in category C1 (and one unsold lot in category C2). Since the bidder has reduced demand with 4 points in the auction the bidder could (disregarding spectrum caps,) submit an additional bid for C1 (e.g. at 180), i.e. submit two distinct Exit bids for C1 (and one Exit bid for C2).

Suppose the bidder has won 110 MHz across the 2100/2600FDD/2600TDD bands in the clock stage of the auction.

Question: Would the auction system allow the bidder to submit two bids for C1 (even though only one lot could be won)?

Answer

As above, the bidder can submit only one exit bid for one single lot, in order not to violate the spectrum cap.

Svar

Liksom ovan kan budgivaren endast lägga utträdesbud på ett (1) block. Detta för att inte bryta mot spektrumtaket.

The example is related to B-blocks, but instead consider the situation described in 4.5.2.6 Exempel 6 – Möjliga utträdesbud

There is one unsold lot of C1 and one unsold lot of C2.

Suppose a bidder has won 110 MHz across the 2100/2600FDD/2600TDD bands in the clock stage of the auction, but has eligibility to submit Exit bids equivalent to two points.

Suppose the bidder submits one Exit bid for C1 and one separate exit bid for C2.

Answer 

Such action is not possible, see above.

Svar 

Ett sådant agerande är inte möjligt (se ovan).

Due to spectrum caps the bidder cannot win both C1 and C2.

Suppose both bids would have been winning bids in both categories (i.e. would maximize revenues in category C1, and maximize revenues in category C2).

Questions:

• How does the winner determination decide which lot is won and which one is not?

Answer

Such situation is not possible, see above.

Svar

En sådan situation kan inte uppstå (se ovan).

• More generally: In the event of multiple unsold lots after the clock round, there might be alternative ways to allocate lots to bidders based on their exit bids. What are the criteria for determining how to allocate those lots?

Answer

The process for determining winners is per category and independent across categories. Please refer to the penultimate paragraph in section 4.4.2.5 in Open Invitation part 2. For the avoidance of doubt, bidders cannot bid for more spectrum than allowed by the spectrum cap, and therefore there is no conflict between assigning a bidder more lots in one category vs. more lots in another category due to the spectrum cap. Within each category, ties are resolved with random draws.

Svar

Processen för att fastställa vinnare är per kategori, utan beroende mellan olika kategorier. Se det näst sista stycket i avsnitt 4.4.2.5 i Allmän inbjudan del 2. En budgivare kan inte bjuda på fler block än vad spektrumtaket tillåter, och därför finns det ingen konflikt mellan att tilldela en budgivare fler block i en kategori kontra fler block i en annan kategori till följd av spektrumtaket. Om det inom en kategori finns utfall som genererar samma värde kommer lottdragning ske mellan dessa utfall (via en slumpfunktion i mjukvaran).

Answer

At the end of each clock round, and for each lot category, PTS will assess if there is a need to increase the clock price, which is the case if the demand in the lot category exceeds the available supply (see section 4.4.2.3 in Open Invitation part 2).

PTS suggests that there are opportunities for learning over time. For example, the price increase rate (the percentage price increase) and the price increase frequency (how often price increases occur) contribute to such learning.

Svar

PTS kommer vid slutet av varje klockrunda, för varje kategori, att bedöma om det finns ett behov av att höja klockpriset, vilket är fallet om den sammanlagda efterfrågan i kategorin överstiger utbudet (se avsnitt 4.4.2.3 i Allmän inbjudan del 2).

PTS bedömer att det finns möjligheter för ett lärande över tid. Exempelvis bidrar prisökningstakt (procentuell prisökning) och prisökningsfrekvens (hur ofta en prisökning sker) till ett sådant lärande.

Antag tre budgivare:

I runda n+2 drar budgivare 1 ner efterfrågan i kategori A2 från 4 till 2 och erhåller rätten att lägga två utträdesbud. I samma runda reducerar budgivare 2 och 3 efterfrågan i kategori B och C1 så att underefterfrågan uppstår med ett block i vardera av dessa kategorier.

I utträdesbudrundan lägger budgivare 2 ett bud i kategori B och budgivare 3 ett bud i kategori C1. Båda på miniminivå. Budgivare 1 lägger ett bud i vardera kategori på miniminivå + 1 SEK.

Från 4.3.2 "Spektrumtaken gäller under hela auktionsförfarandet, dvs. även vid en eventuell utträdesbudsrunda (enligt avsnitt 4.4.2)."

Från 4.4.2.5 "Utträdesbud läggs separat för varje kategori och utvärderas separat för varje kategori."

Från 4.3.4 "Inom varje kategori vinner den kombination av utträdesbud som maximerar värdet på de ingående blocken."

Fråga: Under dessa omständigheter måste ett avsteg från någon av reglerna ovan göras.

Övrig budgivning (exempel):

Svar

Budgivare 1 har i klockrundorna vunnit 110 MHz i B & C1-kategorierna. Spektrumtaket i mellanhöga band är 120 MHz. Budgivaren kan därför som mest lägga ett (1) utträdesbud för ett (1) block i kategori B eller ett (1) block i kategori C1.

According to information from PTS:

”För blocket i kategori A3, som har 0 (noll) som lägsta bud, höjs det absoluta priset på motsvarande sätt som för två block i kategori A2.”

Situation A: The clock-round price of A2 has increased more frequently than A3. Let

• Inc_A2_1=15 MSEK (assuming 10% increase) represent the first increment of A2, with a corresponding A2 clock-round price of 165 MSEK
• Inc_A2_2=8.25 MSEK (assuming 5% increase) represent the second increment of A2, with a corresponding A2 clock-round price of 173.25 MSEK
• ….

Suppose later in the auction there is excess demand for A3. A3 needs to be increased:

• Will the second price level of A3, after the first price increment has been added, be equal to 30 MSEK (=2*Inc_A2_1)?
• Will the third price level of A3, after the second increment has been added, be equal to 46.5 MSEK (=2*Inc_A2_1+2*Inc_A2_2=30+16.5)?

More generally, will the Nth price level of A3 be equal to:  0 + 2*( Inc_A2_1 + … + Inc_A2_N-1)

Situation B: The clock-round price of A3 must be increased more frequently than A2. In this case there are not enough observed price increments of A2 that can be used for calculating clock-round prices of A3. Will PTS then (for non-observed A2 price increments) calculate hypothetical price increments for A2 and deploy those on A3?

Example:

• There is excess demand for A2 and A3 in round one.
• In round 2 there is excess demand for A3, but not for A2

Assuming the same assumptions as above:

• (Same as above) Will the second price level of A3, after its first increment has been added, be equal to 30 MSEK?

Since there exists only one (1) price increment for A2, will PTS then calculate a hypothetical second price increment for A2 and deploy this as an input for calculating the second price increment for A3?

Assuming the same assumptions as above, will the clock-round price of A3 in round 3 be 46.5 MSEK?

Answer

Two times the reserve price for a lot in the A2 category, that is, 300 MSEK, serves as an anchor for the first price increase for the lot in the A3-category.
Assume demand exceeds supply, for the first time, in the A3 category. If the rate of price increase were to be, for instance, ten percent, the clock price in the next clock round would be 30 MSEK.

After the first price increase for the lot in the A3 category has taken place there is a new basis from which the next price increase for the lot is determined (in case demand exceeds supply in the category). With the assumption in the previous paragraph the new basis would be 330 MSEK, that is, the sum of 300 MSEK and the prevailing clock price in the A3 category.

These bases for price increases in the clock rounds will evolve according to the rate of price increase in the A3 category.

Svar

Två gånger lägsta bud för ett block i A2-kategorin, dvs. 300 MSEK, utgör referensvärdet för den första prisökningen för blocket i A3-kategorin.

Antag att efterfrågan överstiger utbudet i A3-kategorin för första gången. Om prisökningstakten skulle vara exempelvis tio procent skulle klockpriset i nästa klockrunda bli 30 MSEK.

Efter att den första prisökningen för blocket i A3-kategorin har ägt rum finns en ny bas varifrån nästa prisökning för det blocket räknas fram (om efterfrågan överstiger utbudet i kategorin). Med antagandet i föregående stycke skulle den nya basen bli 330 MSEK, dvs. summan av 300 MSEK och det i klockrundan gällande klockpriset för blocket i A3-kategorin.

Baserna för prishöjningarna i klockrundorna bestäms och utvecklas enligt prisökningstakten för blocket i A3-kategorin.

Auction participation requires planning and coordination with stakeholders. Could PTS therefore – a day in advance – publish information about price increments the next auction day?

Answer:  

For each clock round, PTS will announce clock prices at the start of the round.

Svar:

PTS kommer, för varje klockrunda, att tillkännage klockpriserna när rundan startar.

The response to our previous question did not clarify how bidders are supposed to learn anything from the size of price increases. If PTS does not explain how bidders are supposed to interpret price signals, then we do not agree with PTS’ statement that there are opportunities for learning over time during the auction. We note that PTS has written: “Den procentuella prisökningstakten i en viss kategori kommer inte att öka under klockrundornas fortskridande.” Our understanding is thus that while the size of price increases in a lot category will not increase during the auction, it may decrease. Would it be correct to assume that a reduction in the size of price increases in a lot category would be related to lower excess demand, i.e. PTS expects to slow the rate of price increases as demand comes down to meet supply?

Answer:

There is no mechanical rule for price increases. PTS refers to its previous statements and answers.

Svar:

Det finns ingen mekanisk regel för hur prisökningar kommer att ske. PTS hänvisar till tidigare skrivningar och svar.

Fråga 5 i ”Frågor och svar” efterfrågar bl.a. om/hur storleken på överefterfrågan i en viss kategori påverkar storleken på höjningen. Skall PTS svar tolkas som:

1. Det kommer inte att finnas någon sådan påverkan
2. Det kan komma att finnas en sådan påverkan, men hur den ser ut kommer inte att delges budgivarna
3. Något annat och, i så fall, vad?

Svar:

Se svaret på fråga 9.

a. PTS has stated: ”Den procentuella prisökningstakten i en viss kategori kommer inte att öka under klockrundornas fortskridande."

b. Could PTS please confirm that this means that the size of price increases cannot increase during the auction, even if there is an increase in the level of excess demand in a lot category, due to bidders switching in from other bands?

c. See the illustrative example below:

d. Is it correct that this could never happen? In other words, is it correctly understood that in this scenario, if PTS had made the decision to implement a price increase of 5% in round n+1, then PTS would never implement a price increase larger than 5% in any following round, even if demand were to increase?

e. If this understanding is correct, then this further supports our view that there are not any meaningful opportunities for learning over time during the auction.

Answer:

The question refers to PTS’s statement “Den procentuella prisökningstakten i en viss kategori kommer inte att öka under klockrundornas fortskridande.” This statement is correct.

Svar: 

Frågan gäller följande kommunikation från PTS: “Den procentuella prisökningstakten i en viss kategori kommer inte att öka under klockrundornas fortskridande.” Påståendet är korrekt.

a. Assume that bidder 1 submits bids in the following manner:

b. Assume further that the auction closes in round n + 4, and that two blocks in lot category B remain unsold.

c. In this example, bidder 1 would already during the main auction have won a total of 100 MHz across the 2100/2600FDD/2600TDD bands. This would mean that bidder 1 would only be able to win an additional 20 MHz across the 2100/2600FDD/2600TDD bands to remain below the spectrum cap.

d. Could PTS please confirm that bidder 1 would nevertheless still be able submit both of the following exit bids:

         i. 2 blocks of B @ 104

        ii. 1 block of B @ 117

e. We assume that it is possible for bidder 1 to submit both bids, despite the fact that winning both bids would breach the spectrum cap, as it would in any case not be possible for bidder 1 to win both bids, since only two blocks in lot category B went unsold.

Answer  

If there are, following the example, two B lots available for the exit bids round, then it is not possible that a bid for two lots and a bid for one lot are both winning. Accordingly, making both bids is an offer to acquire either both lots (with the bid for two lots at 104 per lot) or, alternatively, one lot (with the bid for one lot at 117). In this case, submitting both bids would not violate the spectrum cap.

Svar

Om det som i exemplet finns två B-block tillgängliga i utträdesbudsrundan är det inte möjligt att ett bud på två block och att ett bud på ett block båda vinner. Innebörden av att lägga båda buden är att budgivaren bjuder på att antingen köpa båda blocken (med budet på två block till priset 104 per block) eller, alternativt, köpa ett block (med budet på ett block till priset 117). Att lägga de båda buden står, i detta fall, inte i konflikt med spektrumtaket.

In the Open invitation part 2 section 4.5.2, towards the end of example 1, there is a discussion about the lot in the A3 category.

Assume the bidder in the auction in example 1 instead had made reductions of only one eligibility point at a time, that the bidder when the clock rounds ended had won two A2 lots, and that the lot in the A3 category was then unsold.

More generally, assume A3 is unsold after the clock rounds and that a bidder has only made reductions of one eligibility point at a time, throughout the entire auction, and that the bidder wins at most two A1/A2 lots in the clock rounds.

For clarification: Would such a bidder have the possibility to place an exit bid on the A3 lot?

Answer

No. In case the lot in the A3 category is available in an eventual exit bids round, according to section 4.4.2.5 in the Open invitation part 2, only those bidders that have reduced their total demand with (at least) two (2) eligibility points between two consecutive clock rounds, would be able to place an exit bid on the lot in the A3 category (providing the spectrum cap is not violated).

Svar

Nej. Om blocket i A3-kategorin finns tillgängligt i en eventuell utträdesbudsrunda skulle, i enlighet med kapitel 4.4.2.5 i Allmän inbjudan del 2, bara de budgivare som dragit ned sin totala efterfrågan med (minst) två (2) aktivitetspoäng mellan två på varandra följande klockrundor kunna lägga utträdesbud på blocket i A3-kategorin (under förutsättning att spektrumtaket så tillåter).