Telecoms regulator Ofcom said on Thursday that seven companies had qualified to bid for the UK’s 4G spectrum auction which begins next month.
EE, a joint venture between France Telecom and Deutsche Telekom, has already launched LTE services in major British cities by reallocating its existing airwaves in the 1.8 GHz band.
The following organisations have qualified to bid in the auction, which will start in January 2013:
- Everything Everywhere Limited (UK)
- HKT (UK) Company Limited (a subsidiary of PCCW Limited)
- Hutchison 3G UK Limited
- MLL Telecom Ltd
- Niche Spectrum Ventures Limited (a subsidiary of BT Group plc)
- Telefónica UK Limited
- Vodafone Limited
Bidders will be competing for spectrum in two separate bands – 800 MHz and 2.6 GHz. The lower frequency 800 MHz band was freed up when analogue terrestrial TV was switched off. These two bands add up to 250 MHz of additional mobile spectrum, compared to 333 MHz in use today. The frequency auction begins next month and is expected to take several weeks.
The chief executive of Ofcom, Ed Richards, insisted the primary goal of the auction is not to raise as much money as possible but to ensure the best services for consumers.
Currently, only Everything Everywhere offers LTE service in the U.K., using their refarmed 1800 MHz band. Competing mobile operators Telefónica UK (O2), Vodafone UK and 3 will be able to start playing catch-up with rival Everything Everywhere.
The UK has decided to break the 190 MHz-wide band of 2.6 GHz frequencies into two groups, 140 MHz of paired frequencies and 70 MHz of unpaired.
Ofcom has made no estimate of how much the 4G sell-off will raise beyond setting a £1.4bn reserve for the 28 chunks of radio spectrum it plans to distribute among at least four of the bidders, to guarantee competition.
The auction is expected to raise £3.5bn for government coffers, or 0.2% of the UK’s annual economic output, according to the Office for Budget Responsibility – far less than the £22bn raised by the auction of 3G space, which was held at the height of the dotcom bubble in 2000.
United Kingdom has a total of 80 million subscribers, with a 130.55% penetration rate. Mobile operators in the UK include:
- Everything Everywhere: 27.2 million subs, owned by France Télécom aka Orange (50%) and Deutsche Telekom (50%).
- O2: 22.3 million subs, owned by Telefónica, a Spanish broadband and telecommunications provider
- Vodafone: 19.2 million subs, owned by Vodafone, headquartered in London.
- 3: 8.2 million subs, owned by Hong Kong-based Hutchison Whampoa
The 50-50 venture of Vodafone and Telefónica will encompass a combined 18,500 cell tower masts, an increase of roughly 40 percent for each operator. Telefónica already shares its network with Vodafone in Spain and with T-Mobile in the Czech Republic.
Everything, Everywhere got a jump on LTE in the UK by refarming its 1.8 GHz frequency.
Related Dailywireless articles include; UK Begins 800/2.6GHz Auction Process , Joint LTE Network in UK Planned by Vodafone and Telefónica, UK Spectrum Auction: Delayed Again?, 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, 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,