UK regulator Ofcom revealed the rules for mobile spectrum auction in 2017 to assist operators EE, Vodafone, Three and O2 to expand their mobile data presence and 5G.
Three UK responds
Three UK CEO Dave Dyson said: “By making decisions that increase the dominance of the largest operators, Ofcom is damaging competition, restricting choice and pushing prices up for the very consumers that it is meant to protect.
“The mobile market is imbalanced and failing customers. Ofcom has shown little interest in tackling the problem. We will consider our response as a matter of urgency,” Dave Dyson said.
Immediately useable spectrum with four MNOs in UK
BT / EE: 255 MHz
Vodafone: 176 MHz
Three (H3G): 90 MHz (plus 40 MHz – useable in 2020)
O2 (Telefonica): 86 MHz
Ofcom has set reserve prices of £10m per 10 MHz lot of the 2.3GHz band, and £1 million for a 5 MHz block in the 3.4GHz band. These are unchanged since Ofcom’s statement in October 2015, giving a total reserve price of £70 million for the 190 MHz of spectrum to be awarded.
Ofcom said the spectrum auction in 2017 will help meet mobile broadband demand and support 5G mobile roll outs.
Highlights
# new cap on overall spectrum
# airwaves for mobile broadband to increase by almost a third
# Can expand mobile Internet and enter 5G
# EE will not be able to bid for spectrum in 2.3GHz band
# EE can win a maximum 85 MHz of new spectrum in 3.4GHz band
Ofcom will auction licenses to use 190 MHz of spectrum in two frequency bands, increasing airwaves available for mobile devices by almost one third.
Ofcom will auction 40 MHz spectrum in 2.3GHz band. Telecoms can use these airwaves immediately after release to provide extra capacity.
Ofcom will also sell 150 MHz spectrum in 3.4GHz band for 5G mobile.
Ofcom will auction the spectrum in lots of 10 MHz for the 2.3GHz band and 5 MHz for the 3.4GHz band.
Ofcom will impose two different restrictions on bidders to limit the amount of spectrum operators can win in the 2.3GHz band. There will be overall limits on the spectrum an operator can win across the 2.3GHz and 3.4GHz bands in aggregate.
Ofcom will place a cap of 255 MHz on the immediately useable spectrum that any one operator can hold as a result of the auction. This cap means BT / EE will not be able to bid for spectrum in the 2.3GHz band.
Ofcom has kept an additional cap of 340 MHz on the total mobile spectrum a single operator can hold as a result of the auction. This cap amounts to 37 percent of all the mobile spectrum expected to be useable in 2020, which includes the spectrum available in this auction and 700MHz band.
The effect of the caps will be to reduce BT / EE’s share of mobile spectrum; the company can win a maximum 85 MHz of new spectrum in the 3.4GHz band.
The overall cap also means that Vodafone could gain a maximum 160 MHz of spectrum across both the 2.3GHz and 3.4GHz bands.
Based on today’s spectrum holdings, there will be no restriction on the amount of spectrum that any other bidder could win.
Ofcom will also look to include new obligations in future spectrum licenses to ensure rural coverage continues to improve, and are making further spectrum available for mobile in the 700MHz band in 2020.
The mobile spectrum to be useable in 2020 includes immediately useable spectrum plus 190 MHz in the 3.4GHz band as well as 80 MHz in the 700MHz band. However, the caps only apply to this award.
Who got spectrum?
Three now has more spectrum. After acquiring UK Broadband in February, the operator Three has access to 40 MHz of mobile spectrum in the 3.4GHz band, plus 84 MHz in the 3.6 to 3.8GHz band.
Three and Vodafone have extra spectrum available in the near-term. Each holds 20 MHz of spectrum in the 1400MHz band, acquired in a trade from Qualcomm in 2015. These airwaves could be used by Three to improve its capacity in the near term, around 2018, before it can put its other spectrum to work.
