The 4G auction mist has cleared and we now know which companies were successful bidders and which missed out. The secret 4G auction bidding process began late last year when seven applicants were approved to take part in the auction.
4G Auction - the winners and losers
Ofcom have confirmed that five bidders were successful in the 4G auction while 2 missed out. The successful bidders were Everything Everywhere ( EE ), Vodafone, O2, Three and Niche Spectrum Ventures ( sub of BT Group ). The bidders who missed out were MLL Telecom Ltd and HKT (UK) Company Ltd.
The UK Government were expecting to achieve £3.5 billion from the 4G auction but this fell short with only £2.34 billion being achieved – a shortfall of £1.16 billion. The big spenders in the 4G auction were Vodafone and EE who spent £790 million and £588 million respectively. A full breakdown of the bidders, the 4G frequency slices they won and for what amounts they spent can be seen below.
The spectrum above comprises of 250MHz worth of frequency slices within the 800 MHz and 2.6GHz bands. This amount of spectrum equates to over 66% of the total spectrum currently used in the UK for 2G and 3G mobile services.
The 800MHz frequency band is more desirable for overall indoor and outdoor coverage whilst the 2.6GHz frequency band is more suited in highly populated areas such as towns and cities.
4G Auction - how each operator fared
Everything Everywhere is currently the only 4G operator offering 4G mobile services in the UK and also the only operator to have secured 4G frequency spectrum in all three bands – the 800MHz, 1800Mhz and 2.6GHz bands. EE were fortunate to have Ofcom grant them a concession to launch 4G in its old, unused 1800Mhz spectrum – previously used for 2G services. They won spectrum in the 800MHz and 2.6Ghz bands.
Three bought a chunk of 1800MHz frequency spectrum from EE, but a condition of the sale is that they can’t launch 4G within this band until October, 2013. Three were successful in bidding on spectrum in the 800Mhz band so they will be able to launch 4G in the 800MHz and 1800Mhz frequency bands.
O2 have bought 4G frequency spectrum in only the 800Mhz band and, taking everything into account, have the least frequency spectrum available for 4G mobile services.
Vodafone have applied to Ofcom to use some of their old 1800MHz frequency spectrum for 4G services and won additional 4G spectrum in the 800MHz and 2.6Ghz frequency bands. Overall, Vodafone appear to be in a good position to offer its customers a great 4G service.
Spectrum Niche Ventures ( BT Group ) won 4G spectrum in the 2.6GHz which seems to indicate the company will use this to offer 4G mobile services in towns and cities for which the 2.6Ghz band is best suited.
4G Auction - the final stage
The auction has not yet concluded, with the final stage being the allocation of actual frequency slots within the 800MHz and 2.6Ghz frequency bands to each successful bidder. This will begin soon and is called the “assignment stage”