Vodafone and O2 block new spectrum plan

Talks with Vodafone and O2 are holding up government plans to rearrange radio spectrum allocations that would see universal access to mobile connections running at 4gbps and up to 50mbps in urban areas within five years.

Talks with Vodafone and O2 are holding up government plans to rearrange radio spectrum allocations that would see universal access to mobile connections running at 4mbps and up to 50mbps in urban areas within five years.

This emerged from the final report of Kip Meek, the independent spectrum broker appointed by the government to negotiate the release of 900MHz spectrum (2G) held by the two mobile network operators (MNOs).

Meek said, "Discussions have shown that a negotiated solution to 2G refarming may not achieve the objectives and is very difficult to conclude."

Communications regulator Ofcom proposed that Vodafone and O2 relinquish 2x5MHz of contiguous spectrum, and that if they could not negotiate a deal the spectrum should be auctioned.

"Although neither 900MHz operator likes this proposal, and both made clear that it would impose inconvenience on their customers and substantial costs, at least one operator was satisfied with its outcome," Meek said.

He said one operator in particular wanted to use its 900MHz frequencies to deploy 3G mobile broadband (HSPA). It had become clear that all the operators wanted to look at the issues associated with 2G spectrum in the broader context of other spectrum that is due to become available, namely 2.6GHz and 800MHz.

"A negotiated solution that used the proposed Ofcom imposed solution as a starting point would not achieve this outcome." Meek said.

He said that the two inducements on offer were an indefinite licence term for the 2.1GHz licences and a more liberal regime for infrastructure sharing. Vodafone and O2 welcomed them, but thought them inadequate. "Infrastructure sharing is seen as something that is likely to happen anyway if there is a sufficiently good economic and commercial case."

Meek said it was "within the UK's grasp" to achieve mobile broadband at around 4mbps across the UK as a whole, and more than 50mbps in many urban areas within five years.

This would bring innovation and new services in mobile broadband and complement fibre-delivered superfast broadband. This would make the transition to next-generation broadband services smoother and faster, he said.

"The UK would be at the forefront of commercially-deployed mobile technology around the world, delivering economic and social benefits that far outweigh the costs."

Meek said he had identified a new imposed and a preferred set of mechanisms. "These are likely to be refined and changed as they are considered in greater detail," he said.

The government said it would respond to Meek's statements in the final Digital Britain report, now expected on 16 June.


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