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UK 4G services set to expand as all major carriers win spectrum in Ofcom auction

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London Shard_stock
London Shard_stock

Ofcom has announced the winners of its long-awaited 4G spectrum auction in the UK. Major carriers O2, Vodafone, EE, and Three have all won spectrum, and so has Niche Spectrum Ventures, a subsidiary of BT. Consumer services are expected to start rolling out in spring or summer this year, and O2's allocation of 800MHz spectrum means that it is obligated to cover 98 percent of the UK population with indoor reception by the end of 2017.

Auction falls short of government expectations

Vodafone was the highest bidder and will pay over £790 million (about $1.22 billion) for a mix of 2.6GHz and 800MHz spectrum, but overall the auction raised less money than expected. While the UK Treasury had budgeted for a £3.5 billion ($5.4 billion) influx of cash, the total amount came to £2.34 billion ($3.61 billion) — about a tenth as much as the 3G spectrum auction raised in 2000.

The only 4G network in the UK at present is EE, which rolled out LTE service in time for the iPhone 5 last year after Ofcom granted early approval for the carrier to use its 1800MHz spectrum. Today's auction results mean that once EE's major competitors have bid for specific assignments of spectrum and paid license fees, they will be free to go ahead with rolling out LTE networks of their own.