02 Jan 2013 10:50 AM

Seven bidders line up for UK mobile spectrum auction

Big four mobile operators are joined by BT, MLL Telecom and PCCW for sale of 800MHz and 2.6GHz spectrum in the UK

Seven bidders line up for UK mobile spectrum auction

Seven bidders have registered to bid for the forthcoming auction of 800MHz and 2.6GHz spectrum in the UK, according to telecommunications regulator Ofcom. 

The organisations qualified to bid in the auction, the largest ever sale of mobile airwaves in the UK, which will start this month (January 2013) are:

Everything Everywhere (UK)

HKT (UK) Company (a subsidiary of PCCW Limited)

Hutchison 3G UK 

MLL Telecom 

Niche Spectrum Ventures (a subsidiary of BT Group plc)

Telefónica UK 

Vodafone 

Bidders will be competing to acquire new capacity to roll out superfast 4G mobile broadband services to cities, towns and villages across the UK. This new spectrum will boost the amount of airwaves available to mobile phones by more than 75% and will play a critical role in helping to meet a growing demand for mobile data among consumers.

Ed Richards, Ofcom chief executive, said: ‘The 4G auction will be a competitive process that will dictate the shape of the UK mobile phone market for the next decade and beyond. New 4G services will stimulate investment, growth and innovation in the UK and deliver significant benefits to consumers in terms of better, faster and more reliable mobile broadband connections.’

In July 2012, Ofcom published the outcome of its competition assessment of the UK mobile market. This concluded that UK consumers are likely to benefit from better services at lower prices if there are at least four credible national wholesalers of mobile services.

Ofcom has therefore in the interests of competition designed the auction in a way intended to achieve this outcome. Bidders will be competing for spectrum in two separate bands – 800MHz and 2.6GHz. The lower frequency 800MHz band is part of the ‘digital dividend’ freed up when analogue terrestrial TV was switched off, which is ideal for widespread mobile coverage.

The higher frequency 2.6GHz band is ideal for delivering the capacity needed to deliver faster speeds. These two bands add up to 250MHz of additional mobile spectrum, compared to 333MHz in use today. Both bands are being packaged into smaller lots for the auction.

This combination of low and high frequency spectrum creates the potential for 4G mobile broadband services to be widely available across the UK, while offering capacity to cope with significant demand in urban centres, Ofcom said. 

James Walsh, head of telecoms at global law firm Eversheds, commented: 'The only bidders who are not one of the four existing major mobile network operators in the UK are MLL Telecom, and subsidiaries of BT and PCCW. Bids from BT and PCCW were largely expected given BT’s role in LTE trials in the UK, and PCCW’s launch of the first wholesale LTE network through another subsidiary, UK Broadband, early in 2012. MLL Telecom’s bid is perhaps a surprise, however. The good news for the Government is that having seven bidders should help to maximise revenue from the auction.'



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