You may recall the report last month on the spectrum auction across the pond in the United Kingdom. This bidding war was for 28 lots of the 800MHz and the 2.6 GHz bands designated for LTE and other mobile broadband services, totaling 250 MHz of spectrum. This is “equivalent to two-thirds of the radio frequencies currently used by wireless devices such as tablets, smartphones and laptops”, according to Ofcom. Well now after fifty rounds of bidding, Ofcom has announced that the winners are in.
Out of the seven companies that were bidding, five have won pieces of the valued spectrum. The winners are BT, Vodafone, Telefonica/O2, EE, and Three. That leaves MLL Telecom and HKT (UK) Company Limited out in the cold with unsuccessful bids. Although Ofcom did not specifically say what these carriers had to do with their new spectrum it’s assumed that EE, Three, Vodafone and O2 are likely to use it for LTE, while BT will probably use theirs for other services like building out its existing WiFi network as well as wholesale services. The first LTE services should be ready in six months.
These lots became available as part of the ‘digital dividend’ freed up when analogue terrestrial TV was switched off. The hope is that the results of this auction will bring the UK up to par with other countries since even though a total of 61% of the population owns smartphones, the country has thus far lagged behind in offering faster broadband speeds, specifically LTE.
The British government had hoped to raise £3.5 billion but they fell short of that number by over a billion raising just £2.3 billion. According to Matthew Howett, telecoms regulation analyst at Ovum: “Despite all the noise being made about the UK’s 4G auction, what you can’t hear is the sound of champagne corks popping over at the Treasury as Ofcom’s 4G auction fails to raise George Osborne’s optimistic expectation of £3.5 billion coming in at £2.34 billion. For the mobile operators there must be widespread relief that the amount paid is a mere fraction of the £22.5bn they were asked to cough up during the 3G licensing process.”
Here is the final breakdown of the winners: