The long-delayed auction of spectrum to carry LTE service in the UK looks set to go ahead late this year after the regulator Ofcom issued new terms that it expects will ensure greater coverage and protect competition.
Ofcom said the revised rules are designed to ensure that mobile network coverage will be extended to "at least" 98 per cent of the UK population including so-called mobile "not spot" areas, and should also guarantee there will be at least four national wholesalers of mobile services in future.
Ofcom is now seeking comments on the revised proposals, which also contain proposals to reserve some spectrum for new entrants and initiatives in the mobile telecoms market, within the next 10 weeks. The regulator said the final decision on the auction design will be made this summer, and the auction itself will start in fourth quarter.
The UK is lagging behind many European countries with its auction of spectrum for future mobile networks based on LTE, delayed by operator opposition to the auction terms. The new revisions at last suggest that UK mobile operators will be able to get their hands on spectrum in the 800MHz and 2.6GHZ frequency bands by the start of next year.
According to a Reuters report, analysts said the new proposals were, as expected, potentially negative for Everything Everywhere, positive for 3UK and probably acceptable to Vodafone and O2. They could also make the auction for the sub-1GHz spectrum more intense.
"From this, Ofcom's second consultation, it's clear that Ofcom continues to value Three's disruptive nature and wants to in effect guarantee its existence post-auction," Ovum analyst Matthew Howett told Reuters. "However it considers that Everything Everywhere has sufficient spectrum available not to be protected in the same way."
The Financial Times reported that the auction is expected to raise between £3 billion and £4 billion, according to latest forecasts.
The move was welcomed by Vodafone, which said it believed the "revised proposals, which bring the UK closer to a fair and open auction that will benefit the wider economy, increase competition and ultimately lead to the creation of innovative and exciting new services for consumers."
Vodafone added that the industry still needed "to understand the regulator's rationale for protecting a fourth operator."
For more:
- see this release
- see this FT article (reg. req.)
- see this Reuters article
- see this Bloomberg article
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