The UK’s 4G spectrum auction has raised £2.34 billion ($3.62 billion), with BT and the country’s four main mobile carriers winning new spectrum that will allow them to roll out LTE services.
The auction took in 250MHz of spectrum in the 2.6GHz band, which is high-bandwidth and good for urban deployments, and the 800MHz band, which is lower-bandwidth but longer-distance and better for rural deployments. EE (which already runs 4G on reused 2G spectrum) and Vodafone both won spectrum in both bands, while Three and O2 (Telefonica) each won spectrum in the 800MHz band. Niche Spectrum Ventures (a BT subsidiary) won 2.6GHz spectrum.
The reserve price for the auction was £1.3 billion, although the government had budgeted for it to bring in £3.5 billion. Does that make the result disappointing? That depends on whether you see the government forecast as politically motivated or focused on the actual worth of the spectrum. There was never much justification given for the £3.5 billion figure, and no-one appears to be taking responsibility for it — today the Treasury told me to take my questions about the figure’s rationale to the Department for Culture, Media and Sport (DCMS), and the DCMS told me to ask the Treasury.
According to the regulator Ofcom, new services should roll out in about six months’ time, and the whole of the UK will be able to receive 4G services “by the end of 2017 at the latest”. This will partly be helped by an obligation placed on Telefonica’s O2 to ensure coverage for at least 98 percent of the UK population through its own network alone.
Ofcom chief executive Ed Richards said this would be good news for parts of the country where mobile broadband is currently scarce:
“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.”
Here’s who won what:
It’s worth remembering that this represents BT’s return to mobile network operator status, after spinning out BT Cellnet (now O2) in 2002. However, as expected, the operator will not be building a national network like the others. According to a statement, the spectrum will let BT “provide its business and consumer customers with an enhanced range of mobile broadband services, building on its existing strength in Wi-Fi”.
This story was updated several times throughout the day as additional information became available.