UK telecoms regulator Ofcom has delayed the mobile phone spectrum auction designed to bring 4G services to British consumers. Ofcom said it had wanted to have a further round of consultation after receiving ‘substantial and strongly argued responses’ to the first consultation.
The regulator insists that the rollout of 4G services in the 800MHz and 2.6GHz bands will not be delayed as the spectrum will not be released until 2013. However, it is doubtful that the operators will be able to deploy a nationwide 4G network in a year, so services are unlikely to be on stream before 2014.
The auction was supposed to take place in the first quarter of 2012. Mobile reported on 1 September that the timetable has slipped to the second quarter of 2012, as Ofcom was unable to complete the auction rules in time to meet the deadline.
However, the UK was originally meant to hold the auction in 2009. It has since been delayed by changes in Government and squabbles between the mobile operators and Ofcom.
The delay will mean the UK is behind the other major economies in Europe. Sweden already has 4G up and running, while Germany, Spain and Italy have completed their 4G auctions and France is in the process.
Ofcom issued a statement explaining its reasons for delaying the auction. ‘We received a number of substantial and strongly argued responses to this consultation. We have been reviewing these responses over the summer, and refining our analysis as a result. In light of these responses, and the significance of the decisions that we need to take - decisions that are likely to shape the future of the mobile sector in the UK for the next decade or more - we have decided to undertake a further round of consultation on these issues.
‘We plan to publish a further consultation document around the end of this year. We will then give stakeholders an appropriate period of time in which to comment on our refined analysis and respond to our revised proposals - likely to be at least eight weeks. Our aim will then be to make our decision and publish a statement in the summer of 2012. The auction itself would then follow a few months later - perhaps starting in Q4 2012.’
The operators have much at stake and the current uneven distribution of spectrum has put various operators at loggerheads. O2 and Vodafone, the only two operators with sub-1GHz spectrum (in the 900MHz band) are unhappy at Ofcom’s proposed caps on the amount of new spectrum they can hold.
They are also unhappy that Everything Everywhere, which holds the most spectrum following the merger of Orange and T-Mobile, and Three, which holds the smallest amount of spectrum, would be guaranteed a minimum chunk of the coveted 800MHz spectrum. Everything Everywhere does have to sell off some of its spectrum as part of the Orange and T-Mobile merger. However, it is unwilling to do so before the 4G auction, as it wants to see what the going prices will be.
Everything Everywhere may take legal action if it feels it is being treated unfairly and not given some sub-1GHz spectrum. O2 and Vodafone may also take action if they feel they are being unfairly capped or excluded. Three believes the current spectrum allocation puts it at a competitive disadvantage. It is angry at any delay to the auction as it badly needs more spectrum to expand its services. Three CEO David Dyson warned last month that Three would experience areas of localised congestion on its network by the end of next year.