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Swiss Mobile Phone Bidders Back Out

ZURICH, Switzerland (AP) — Half of the prospective bidders in Switzerland's planned auction of licenses to operate new-generation mobile telephone services withdrew from the process on Friday.

Within less than 24 hours, four bidders said they were no longer interested in competing for the four licenses, leaving five remaining in the field for Monday's auction. One of the 10 companies originally cleared to bid withdrew in October.

The 15-year licenses had been expected to fetch between $1.13 billion and $1.69 billion at the auction. But if one more bidder withdraws, the auction would be scrapped and the licenses distributed among the remaining companies for the minimum price of $24 million each.

The Swiss communications department said Hong Kong-based Hutchison Whampoa Ltd.'s unit Hutchison 3G Europe Investments and Norway's Telenor Mobile Communications AS withdrew from the race.

Separately, a Deutsche Telekom spokesman in Germany said the company had decided not to participate in the auction.

Two other bidders withdrew late Thursday, citing the anticipated high cost of the license.

The remaining bidders were the Swisscom/Vodafone Airtouch consortium; France Telecom/Orange; two Swiss mobile phone operators Diax and Sunrise Communications AG and Spain's Telefonica.

On Wednesday, the Swiss government announced that Britain's Vodafone AirTouch would take a 25 percent stake in the mobile operations of Swisscom. France Telecom doubled its stake in Orange to 85 percent.

Ten groups were cleared in August to bid for the licenses to operate a new mobile phone standard, known as the Universal Mobile Telecommunications System.

Switzerland, with a population of 7.3 million, is one of Europe's smaller markets, but also is wealthy and potentially lucrative.

Auctions for similar licenses in larger European countries this year have had mixed results.

Last month, Italy reaped $11.6 billion for licenses, far lower than $35.6 billion made by Britain for five licenses and $46.2 billion garnered by Germany for six licenses.

Also in October, Swiss authorities were forced to put off an auction for new licenses to operate current-generation mobile phone services after withdrawals left only the three existing operators in the bidding for three new concessions.
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