Ofcom confirms January 2021 date for next spectrum auction

4 Aug 2020

British telecoms regulator Ofcom has confirmed plans to auction spectrum which it said should ‘help improve mobile broadband and support the rollout of 5G’, setting a January 2021 date for the sale of frequencies in the 700MHz and 3.6GHz-3.8GHz band. In a press release regarding the matter, the industry watchdog confirmed that it will release a total of 80MHz of spectrum in the 700MHz band, following a four-year programme to clear the band of its existing uses for digital terrestrial TV and wireless microphones. Six lots of 2×5MHz will be offered in the lower band, with a reserve price of GBP100 million (USD131 million) per lot. Additionally, there will be four 5MHz lots of downlink-only spectrum with a reserve price of GBP1 million per lot, it said. Meanwhile, Ofcom plans to make available 120MHz of spectrum in the higher 3.6GHz-3.8GHz band, which will be offered in 24 lots of 5MHz (120MHz in total), with a reserve price of GBP20 million per lot.

With Ofcom having previously proposed including coverage obligations in its auction rules, these would have required up to two mobile network operators (MNOs) to increase coverage in rural areas, in exchange for winning discounted spectrum through the auction. However, now that the nation’s cellcos have developed the Shared Rural Network plan in response to Ofcom’s proposals, it deems it no longer appropriate to include coverage obligations in the auction. A 37% cap on overall spectrum holdings has been confirmed though, with the regulator noting this will have the effect of restricting existing MNOs to acquiring the following amounts of spectrum at the auction: BT/EE, 120MHz; Three UK, 185MHz; and Vodafone UK, 190MHz. Due to its current spectrum holdings, O2 UK will not be restricted by the cap.

Rounding out the key elements of its plan, the watchdog also stated that it had considered calls from some MNOs for the spectrum to be allocated through an administrative process – instead of an open auction – in light of the ongoing COVID-19 pandemic. Here, Ofcom said that upon consideration, it did not ‘believe it would meet [its] duty to secure optimal use of the UK’s spectrum and it has sent an open letter to providers to further explain its reasoning in this matter.