Vodafone in first cell phone sale

THE GREEK government has pioneered the outright sale of licences to operate cellular telephone networks in Europe.

A consortium including Vodafone and France Telecom is paying dollars 160m ( pounds 85m) for the right to build one of two cellular telephone networks in Greece. The other licence goes to Stet of Italy for the same sum. Licences are normally granted on technical plans put forward by bidders, rather than by direct sale.

Vodafone said that the licence is regarded as good value. Greece has no existing mobile network and its fixed network is very congested, a spokesman said. The two rival operators are expected to invest an additional dollars 600m between them to set up the networks. They have been set a target of beginning operations in greater Athens within 18 months and covering 85 per cent of the population in six years' time.

The Greek state-owned telephone company, OTE, which is earmarked for privatisation, was excluded from the bidding.

The novel system of selling licences has been closely monitored in other countries and may be considered for cellular systems in the Netherlands and Spain.

A spokesman for the Greek authorities said that steps had been taken to ensure that the technical proposals were also sound.