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Ofcom to auction more 4G spectrum; outlines next steps

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MUMBAI: Ofcom plans to release valuable new airwaves that will improve 4G coverage and be used to meet the growing demand for mobile broadband services in the UK.

Decisions announced today will help Ofcom set the groundwork for the spectrum award, including how these frequencies will be licenced and the mechanics of the auction.

Potential bidders are also being asked for their views on how to best proceed with the auction.

While no specific uses for this spectrum have been prescribed, it is likely to interest the mobile industry, which relies on spectrum to offer internet services to consumers’ smartphones and tablets.

The 2.3 GHz and 3.4 GHz spectrum bands are being released for civil use and could be suitable for providing very high data capacity.

Since Ofcom’s last consultation on the auction, BT has announced plans to buy EE, while Hutchison Whampoa - the owner of Three - has reached agreement to acquire O2 from its current owner Telefonica. If the latter merger goes ahead it would reduce the UK wholesale mobile market from four major operators to three.

Ofcom’s objective is to award the frequencies in a way that will allow consumers to enjoy greater access to high-capacity mobile internet without undue delay.

The consultation invites potential bidders to comment on an option where Ofcom would award most of the newly available spectrum later this year, or early in 2016. The remaining frequencies would be held back for award at a later date.

This approach may be preferable to the alternatives of either awarding all of the spectrum, or delaying the award - although both those options remain open. Ofcom will determine later in the year the best approach to making the spectrum available, following stakeholder responses and the condition of the market.

Under decisions announced today, Ofcom would issue licences for the 2.3 and 3.4 GHz bands for an indefinite period, but with an initial term of 20 years after which licence fees may be payable.

There will be no coverage obligations placed on this spectrum. This is because the frequencies being auctioned are better suited for high capacity and faster speeds, rather than achieving wide geographical coverage.

The closing date for this consultation is 26 June.

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