EE could cut 4G investment if spectrum fees are increased

17 Oct 2013

EE, the UK’s largest cellco by subscribers and the first of the four major mobile network operators to introduce commercial 4G services, has warned it may limit investment in its LTE infrastructure if the government sees through plans to increase the cost of spectrum, according to the Financial Times.

As previously reported by CommsUpdate, last week telecoms regulator Ofcom published a consultation regarding a proposed revision to the annual licence fees for the 900MHz and 1800MHz spectrum bands. As per the proposals EE faces having its annual spectrum fee more than quadruple from GBP24.9 million (USD39.8 million) to GBP107.1 million.

Olaf Swantee, EE’s chief executive, is cited as saying that, should the price increases be applied, his company would look to cover the increased costs by taking them out of its capital expenditure in network infrastructure, rather than allow them to impact underlying earnings. Such a development, the executive claimed, would likely hinder the rollout of 4G services in those rural areas where there government had hoped cellcos would help fill gaps in fixed line broadband coverage. Further, EE has said that the extra costs from higher spectrum fees could also threaten its plans to bring back call centres to the UK.

United Kingdom, EE, Ofcom