It will be at least a year before Ofcom issues an invitation to bid for the so-called 4G radio frequencies that will allow mobile network operators to offer network speeds that are competitive to fixed line broadband.
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This was revealed by Ofcom CEO Ed Richards at a telecoms conference in London yesterday.
In a heavily caveated speech, Richards set out Ofcom's timetable:
- February 2011: consultation on steps for a competitive auction
- May 2011: Consultation ends
- Early autumn: Statement on future competition and details of the combined auction, together with draft auction regulations
- End 2011: Final auction regulations published
- 1Q 2012: Auction starts
- 2Q 2012: Auction ends, results published, licences issued
- 1Q 2013: Spectrum cleared and available
- 4Q 2013: Spectrum release completed
- 1Q 2014: 4G networks up and running
"That is an ambitious timetable," Richards told delegates. The equivalent process for the 3G auction took three years, he said.
Mobile network operators have been waiting for 4G spectrum in the 800MHz and 2.6GHz bands for several years. They want the higher frequencies to relieve congestion in their urban networks, and they want the sub-1GHz frequencies, which carry further than 3G frequencies for the same power, so that they can extend their coverage cheaply.
Commenting on the statement, Stefan Zehle, CEO of telecoms consultancy Coleago Consulting, said the delay put the UK "well behind other markets".
He said the frequencies were needed to enable networks to roll out the next-generation mobile transmission technology known as LTE.
"2014 is rather late, given that LTE services are already up and running in other European countries," Zehle said.
He said the delay in issuing 800KHz and 2.6GHz licences made the 1800MHz band more valuable, because operators may be able to move from 3G GSM to 4G LTE.
"A few networks in Europe are already running or testing LTE in 1800MHz and compatible devices – notably dongles for laptops – are becoming more widely available. This is potentially good news for Everything Everywhere (E20 which holds more 1800MHz spectrum than its competitors."
The delay in issuing licences was caused partly by the merger of Orange and T-Mobile's UK operations into E2, but more so by the threat of legal action.
Firstly, O2 and Vodafone complained they were being asked to give up their 900MHz spectrum, then E2 feared being locked out of the sub-1GHz bands by collusive bidding by O2 and Vodafone. BT, which is reportedly keen to own some mobile spectrum, is another possible litigant.
Former Broadband Stakeholder Group chairman Kip Meek was asked to negotiate a fair spectrum allocation formula, which he completed in March. Since then the new government walked into the E2 litigation threat.
E2 said in November it would suspend its threat, freeing the government and Ofcom to move forward.
Ofcom is under pressure to bring the UK spectrum plan into line with the EU by 2012, so consumers can access network speeds of up to 30Mbps on their mobile phones.