Ofcom has announced that after 50 rounds of bidding Everything Everywhere, Hutchison 3G UK, Niche Spectrum Ventures (a subsidiary of BT Group), Telefónica UK (O2) and Vodafone have all won spectrum for a total payment of £2.34 billion (€2.89bn).
Ofcom says it has achieved its purpose of promoting strong competition in the 4G mobile market. This is expected to lead to faster mobile broadband speeds, lower prices, greater innovation, new investment and better coverage. Almost the whole UK population will be able to receive 4G mobile services by the end of 2017 at the latest.
A total of 250 MHz of spectrum was auctioned in two separate bands – 800 MHz and 2.6 GHz. This is equivalent to two-thirds of the radio frequencies currently used by wireless devices such as tablets, smartphones and laptops.
The lower-frequency 800 MHz band is part of the ‘digital dividend’ freed up when analogue terrestrial TV was switched off, and is ideal for widespread mobile coverage. The higher-frequency 2.6 GHz band is ideal for delivering the capacity needed for faster speeds. The availability of the two will allow 4G networks to achieve widespread coverage as well as offering capacity to cope with significant demand in urban centres.
Ed Richards, Ofcom Chief Executive, said: “This is a positive outcome for competition in the UK, which will lead to faster and more widespread mobile broadband, and substantial benefits for consumers and businesses across the country. We are confident that the UK will be among the most competitive markets in the world for 4G services.
“4G coverage will extend far beyond that of existing 3G services, covering 98% of the UK population indoors – and even more when outdoors – which is good news for parts of the country currently underserved by mobile broadband.
“We also want consumers to be well informed about 4G, so we will be conducting research at the end of this year to show who is deploying services, in which areas and at what speeds. This will help consumers and businesses to choose their most suitable provider.”
Ofcom has attached a coverage obligation to one of the 800 MHz lots of spectrum. The winner of this lot is Telefónica UK Ltd. This operator is obliged to provide a mobile broadband service for indoor reception to at least 98% of the UK population (expected to cover at least 99% when outdoors) and at least 95% of the population of each of the UK nations – England, Northern Ireland, Scotland and Wales – by the end of 2017 at the latest.
A breakdown of what was won, who won it and the base prices payable is detailed below:
|Winning bidder||Spectrum won||Base price|
|Everything Everywhere Ltd||2 x 5 MHz of 800 MHz and
2 x 35 MHz of 2.6 GHz
|Hutchison 3G UK Ltd||2 x 5 MHz of 800 MHz||£225,000,000|
|Niche Spectrum Ventures Ltd (a subsidiary of BT Group plc)||2 x 15 MHz of 2.6 GHz and
1 x 20 MHz of 2.6 GHz (unpaired)
|Telefónica UK Ltd||2 x 10 MHz of 800 MHz
(coverage obligation lot)
|Vodafone Ltd||2 x 10 MHz of 800 MHz,
2 x 20 MHz of 2.6 GHz and
1 x 25 MHz of 2.6 GHz (unpaired)
The following bidders were not winning bidders:
MLL Telecom Ltd
HKT (UK) Company Ltd
The winning bidders now have until 23:59 on 21 February 2013 to pay any outstanding sums to Ofcom for the spectrum they have won. All proceeds from the auction will go to HM Government.