Mobile phone operator Everything Everywhere is to reinvest profits made from the upcoming sale of its 1,800MHz spectrum in the UK's mobile network, following criticism that the sale of a public asset would be diverted to German and French shareholders.
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In 1991, John Major's government gave the spectrum away to mobile operators for free, on the basis that the government would be paid annually through licence fees.
However, when Orange and T-Mobile merged last year to form Everything Everywhere, the European Commission said the company must dispose of 25% of its spectrum due to competition reasons.
Everything Everywhere said it would reinvest the profits of the sale into the UK's communications infrastructure. Earlier this year, Citigroup analysts estimated the sale of Everything Everywhere's spectrum could fetch £450m, reported the Financial Times. The mobile operator did not confirm the figure.
"We are required to sell some 1,800MHz spectrum, for which we pay £33m in licence fees to the government each year. It is our intention that all proceeds from the sale of this spectrum will be invested into our UK network to benefit our customers across the country," said Everything Everywhere.
The statement follows a report from the Commons Culture, Media and Sport Committee, which proposed the company should be forced to reinvest the profits. "Ofcom should explore whether it could compel Everything Everywhere to ring-fence a proportion of this windfall for investment in its network," it said.