The 4G spectrum auction has begun accepting bids from seven interested networks competing to acquire the new airwaves necessary to
provide the new, superfast mobile broadband technology.
Ofcom has announced that bidders include: EE Ltd, HKT (UK), 3G UK, MLL Telecom Ltd, Niche Spectrum
Ventures Ltd (subsidiary of BT), Telefonica UK Ltd and Vodafone Ltd. It’s
thought that the new spectrum will allow almost double the space which is
currently available for mobile broadband, which can be used for smartphones,
tablets and laptops.
Ed Richards, Ofcom Chief Executive, said: "Today’s 4G
auction is a very significant milestone for the UK’s communications sector.
"It will release the essential raw material for the
next wave of mobile digital services. This will change the way we consume
digital media in both our personal and working lives and deliver significant
benefits to millions of consumers and businesses across the country.”
The bidding takes place over several rounds, with bids being
placed over a secure connection using software which has been specifically
written for the auction. In order to develop and maintain "healthy competition”,
the telecoms regulator designed the auction to ensure that a minimum of four separate
network operators will have "sufficient spectrum to be credible national 4G
According to Ofcom, the UK is already the "most competitive
mobile phone market in Europe” and it’s hoped that providing a competitive
marketplace will maintain that, as it means better services can be offered to
consumers at lower prices.
Yesterday, EE announced a cut in prices to its existing
4G services, which the company were allowed to launch ahead of the auction
as it used an existing spectrum belonging to EE. The network cut prices by
around 15% and upped the data download limits.
It’s thought that it will be a number of weeks before the
results of the auction are known and during this time, no updates on the
outcome will be released. This is necessary to avoid any potential risk of "strategic
Following the auction, fees will have to be paid by the
winners before they are granted a license and begin roll-out of 4G. It’s
thought that networks will launch the new services in late spring and summer
The "combination clock” auction format has been used
previously by Ofcom and is designed to put the "spectrum in the hands of those
who value it most highly”. This, Ofcom say, ensures that bidders also pay a competitive
price for the technology.The reserve price for the spectrum has been set at
£1.36bn and is divided into lots.