UK spectrum auction delayed from 1Q 2012

6 Sep 2011

Just a day after TeleGeography reported that the UK’s smallest mobile network operator by subscribers, Hutchison 3G UK (H3G), had warned that legal action being considered by its rivals could delay the country’s largest ever spectrum auction, British broadsheet The Guardian is reporting that the sale has indeed been pushed back. According to the report, telecoms regulator Ofcom had been expected to publish the terms of the auction this month, but it has now been revealed that the document will not be ready until November 2011. As a result, this means that the sale process will now not take place in the first quarter of 2012 as had originally been intended, but a spokesman for Ofcom did note: ‘We are still aiming for the first half of next year. However, we have always maintained it is an ambitious timescale.’

As noted in TeleGeography’s GlobalComms Database, the watchdog had initially set out its auction timetable in March 2011, announcing what it claimed would be the largest ever single auction of mobile spectrum in the country, with the equivalent of three quarters of the UK’s currently in-use frequencies to be offered for sale; spectrum in both the 800MHz and 2600MHz bands is expected to be made available. The regulator said that it viewed the spectrum sale as ‘essential to meet the UK’s rapid increase in mobile traffic, fuelled by the growth of smartphones and mobile broadband data services such as video streaming, email, messenger services, mapping services and social networking sites.’

With Ofcom having set out a number of conditions for the auction process that it claimed would help ensure fair competition in the sector, some operators were quick to criticise the plans, with O2 notably claiming in June 2011 that some of the proposals amounted to state aid, and arguing that the proposed rules for the auction could allow for discrimination against it; O2 argued that ‘spectrum floors’ proposed by Ofcom could see some of its rivals pay around GBP1 billion (USD1.61 billion) less for sub-1GHz spectrum than they would otherwise have to.

United Kingdom, Hutchison 3G UK (Three UK), O2 UK, Ofcom