Three CEO Kevin Russell has hit out at Ofcom’s plans to refarm 2G spectrum, saying the move will ‘jeopardise the competitive environment’.
Ofcom today (6 January) introduced measures to allow O2, Vodafone and Everything Everywhere to refarm their 2G spectrum for 3G services.
The move follows the Government’s Direction to Ofcom on mobile spectrum, which among other things, requires Ofcom to vary existing 2G licences in this way.
It will allow O2 and Vodafone to refarm their 900Mhz spectrum and Everything Everywhere to refarm its 1800 Mhz spectrum for 3G from today.
But Three CEO Kevin Russell said Ofcom and the Government are ‘jeopardising the whole competitive environment that the 3G auction in 2000 started to establish’. This could be a catalyst for further consolidation following the Orange and T-mobile merger, Russell warned.
He said: ‘By opening up these existing frequencies to 3G services without re-auctioning or re-allocating them, or making a clear commitment as to how similar frequencies will be made available in future, Ofcom and the Government are jeopardising the whole competitive environment that the 3G auction in 2000 started to establish.
‘Healthy competition is critical for UK consumers using mobile services and Ofcom and the Government must address the significant competitive distortions they have now created in pushing through the re-farm of spectrum currently used for 2G mobile services. This can only now be done through the structure of the spectrum auction planned for 2012.
‘The competitive benefits of spectrum consolidation and concentration was a key driver in last year's merger of Orange and T-Mobile. If the Government and Ofcom get this wrong further consolidation could result. Ultimately that can only be bad, not good, for UK consumers.’
The UK was required to liberalise 2G spectrum for 3G use by two pieces of European legislation – the amended GSM Directive and associated Radio Spectrum Decision. The Government directed Ofcom to vary the existing licences to achieve this liberalisation on 20 December 2010.This Direction came into force on 30 December 2010.