UK Spectrum Auction: Delayed Again?

The UK’s 4G auction for more 800mHz and 2.6 GHz spectrum may be delayed to preserve competition in the market as well as raise money, reports the Financial Times. Latest plans from UK telecom regulator Ofcom in its draft plan for 2012/13 (pdf) says “wide availability” for 4G might not happen until 2015 at the earliest. Auctions of 4G spectrum have already been completed in Scandinavia, Germany, Spain and Italy, among other European countries.

Ofcom is auctioning spectrum in the 800 MHz and 2.6 GHz bands for 4G services. It will be the largest ever single auction for mobile spectrum in the UK, equivalent to three quarters of the mobile spectrum in use today and 80% more than the 3G auction which took place in 2000.

Initially set to be auctioned in 2012, cellular companies are bickering as to who gets what, and at what cost, reports Cellular News. Ofcom wants lower-share network Three to remain as a viable competitor with the big fish, such as the UK’s own Vodafone, O2, owned by Telefonica, and Everything Everywhere, the 50-50 joint venture between Deutsche Telekom and France Télécom.

Ofcom proposed two spectrum caps:

  • A sub 1GHz safeguard cap of 2×27.5 MHz, which will mean that no one competitor can obtain more than this amount of sub 1 GHz spectrum.
  • An overall spectrum holdings cap of 2×105 MHz, which will mean that no one competitor can obtain more than this amount of spectrum overall.

According to Cellular News, the larger telecom companies believe that the discounted rate that Three would be given would amount to “state-aid”, and disadvantage their operations. The main contention appears to be over the spectrum cap for holdings below 1Ghz, with the regulator treating existing 900Mhz and pending 800mhz spectrum as comparable.

In the UK’s 2.1 GHz spectrum (roughly equivalent to the US AWS spectrum), the main competitors include:

  • Everything Everywhere: A 50-50 joint venture between Deutsche Telekom and France Télécom. The largest mobile network operator in the UK, it has around 28 million customers. It was formed when Orange UK merged with T Mobile UK. Virgin Mobile UK operates on the Everything Everywhere network under a MVNO agreement.
  • 02: Now owned by Telefónica, a Spanish broadband and telecommunications provider in Europe and Latin America. It is the second-largest mobile telecommunications provider in the United Kingdom.
  • Vodafone: A global telecommunications company headquartered in London, it is the world’s largest mobile telecommunications company measured by revenues and the world’s second-largest measured by subscribers (behind China Mobile), but the third largest
  • Hutchison 3G: Owned by Hutchison Whampoa of Hong Kong. Three currently has the highest level of 3G coverage in the UK. In October 2010, Three completed a £400 million upgrade to its network and now covers 97.4% of the UK population.

The UK government aims to raise £5 billion ($8 billion) from the forthcoming spectrum auction.

The UK’s analogue television signals are being switched off, region by region, between 2008 and 2012. In principle, this means that all 368MHz might be available for new uses, but it was previously decided by the Government that 256MHz of the 368MHz should be used for digital terrestrial television (DTT). This digital broadcasting will be provided by six multiplexes, each of which can carry a number of television channels and some other services.

This decision allowed digital terrestrial television to expand its coverage – to match that of analogue, at 98.5% of the population; and its capacity – to around 10 times that of analogue in most of the country, and around 5 times elsewhere.

At the same time, digital switchover will allow the remaining spectrum – 112MHz – to be released for new uses. It is this 112MHz that forms the core of the ‘digital dividend’.

The European Commission has ruled that member states must allow 4G devices to access both 900 and 1,800 MHz radio frequencies by the end of the year.

Related Dailywireless articles include; UK Spectrum Auction: Legal Threat from 02UK?, UK Delays 4G Auction, Ofcom: White Spaces by 2013, UK Gets Free Public WiFi, Europe’s Digital Divide Auction, LTE Spectrum: It’s War, German 4G Auction: It’s Done, Auctions Winding Down in Germany & India, Germany 4G Auctions Begin, Europe to Follow, EU: Global LTE Roaming at 1.8 GHz, T-Mobile Makes Its (4G) Move, End Near for Indian WiMAX?, India’s Broadband Auction: It’s Done, India’s Broadband Auction: No Free Lunch, TD-LTE Gains Momentum, Yota Dumps WiMAX, Australia: WiMAX to TD-LTE, LTE-Advanced Progress, UK Getting LTE, WiMAX to TD-LTE: Everybody’s Doin’ It, Speculation on Sprint Infrastructure, Clearwire Chooses LTE Advanced

Posted by Sam Churchill on .

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