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O2 reveals plans for new 4G mobile spectrum

O2 has already turned on 100 new mobile sites since winning big in the Ofcom spectrum auction, and hopes to activate 900 more this year

Mobile network operator (MNO) O2 is on course to switch on 100 new mobile sites transmitting the new 4G spectrum that it won in Ofcom’s recent auction by the end of April, and is targeting 1,000 new sites by the end of 2018.

The spectrum auction saw both a 40MHz slice of 2.3GHz spectrum to enhance existing 4G networks, and a 150MHz slice of 3.4GHz spectrum to form the core of future 5G networks, go under the hammer.

Five bidders, including all four UK MNOs, took part in the auction, and O2 won all the available 4G spectrum at a cost of £205.9m.

Because the spectrum was available for use immediately, O2 was able to switch on sites to transmit it within 24 hours of winning the auction on 5 April.

“We know how important a fast and reliable connection is to our customers, which is why we’re putting our new 4G spectrum to use as quickly as possible,” said chief operating officer Derek McManus. “We were able to switch on the first sites within 24 hours. Our swift deployment of new 4G spectrum will further enhance the O2 experience for all of our UK customers.”

The new sites are being rolled out across the UK, with priority given to enhancing performance around major transport hubs and shopping areas in major cities. Both of London’s Westfield malls in White City and Stratford were among the first new sites to be switched on.

O2 hopes the additional spectrum will help it meet its users’ rapidly growing demand for mobile data over the next couple of years before 5G becomes commercially available. Last year, the amount of data used by the British public increased by 46% (according to Ofcom’s latest Connected nations report) as people increasingly choose mobile devices over PCs and TVs for internet browsing and media streaming.

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Meanwhile, O2’s parent, Telefónica UK, has announced its first-quarter financial results for the three months up to 31 March 2018, highlighting year-on-year revenue growth of 2.9% to £1.4bn, thanks to higher handset revenues and growth in smart metering and ICT solution non-mobile revenues. Mobile service revenues were up 1.2%, driven by growth among O2’s mobile virtual network operator (MVNO) partners, which include Tesco Mobile and the controversial Lycamobile.

Operating income was up 6.1% to £379m, helped by a reduction in annual licence fee payments, although Telefónica hinted that it would have been higher without the cancellation of mobile roaming charges in the European Union.

“We have delivered another solid quarter driven by our relentless focus on customers,” said Telefónica UK CFO Patricia Cobian. “We are growing top and bottom line in a very competitive market while maintaining the highest levels of customer loyalty and satisfaction in our sector.”

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