Little guys bid for Italian phone license

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Anthill, a mystery consortium made up of more than 1,000 small and medium-sized business in the economically depressed southern Italian regions, is the biggest surprise among the eight bidders participating in the auction of third generation UMTS cellular phone licenses. The company asked to bid only 10 minutes before the deadline.

Anthill is an anomaly among the bidders -- the listis otherwise practically a who's who of the biggest names in the European telecommunications industry -- and the Italian media has focused on it to the extent that the group complains its image may be tarnished. "With everyone saying we are not a serious group because we have no big-name players, that is not positive," Anthill spokesman Nicola Piccenna says.

The name Anthill was chosen because an anthill is built by thousands of workers who are insignificant individually, but who together build something great.

Similar auctions in the U.K. and Germany earlier this year raised $37 billion and $46 billion, respectively. Experts say that with its unusually high cellular phone penetration, Italy is another key part of any company's pan-European strategy.

UMTS technology will allow for high speed data transmission to hand-held devices -- including audio and video. It is expected to be the dominant cellular technology in Europe by 2003.

Italy is selling five licenses, and four are expected to go automatically to the country's existing cellular operators: TIM, the cellular arm of former state monopoly Telecom Italia; Omnitel, controlled by Britain's Vodafone; Wind, controlled by Italian utility Enel and by France Telecom; and Blue, controlled by highway operator Autostrade, Italian media holding company Mediaset and British Telecom.

That leaves Anthill and three other companies to wrestle for the final permit. Little is known about Anthill except that its largest partner is Last Mile, a fixed-line operator based in the southern village of Matera, which has yet to open for business.

Another surprise bidder is Tu Mobile, which is controlled by Tu Tlc Utilities, a group formed in May by a group of managers formerly associated with the Opengate computer services company and the consultancy Atitalia.

The more established among the newcomers are Andala, a consortium controlled by HongKong's Hutchinson Whampoa and Italian Internet giant Tiscal; and IPSE 2000, a group led by Spain's Telefonica and Italian industrial powerhouse Fiat. Analysts say they expect either Andala or IPSE 2000 to win the final permit.

The consortia must present their bids by Sept. 11. In October, the government will reveal which companies it will allow to actually bid on the permits, and the winner will be announced on Nov. 10.

Copyright September 2000, Crain Communications Inc.

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