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4G winners announced, but auction worth less than expected

Derek du Preez | Feb. 21, 2013
Communications regulator Ofcom has announced five winners at the much anticipated 4G spectrum auction, which will allow for the widespread rollout of next generation mobile broadband services across the UK.

Victor Basta, managing director of Magister Advisors, a company that advises technology companies on their IPOs, was underwhelmed by the results.

"The disappointing revenues from the 4G auction, well below Government forecasts, are a reflection of the challenges that mobile operators face in growing revenues from their users in the social media age. Data-heavy social media services are causing huge growth in data traffic across mobile networks," said Basta.

"Mobile operators increasingly find themselves in a role that is about supporting end users' social networking habits, with little, if any, commercial benefit. Social networking has effectively turning mobile network operators into digital drug mules."

Although the auction has now concluded, Ofcom still has to determine where in the 800 MHz and 2.6 GHz bands each winning bidder's new spectrum will be located. This 'assignment stage' will take place shortly, and once this is completed and licence fees have been paid, Ofcom will grant licences to the winners to use the spectrum.

Ofcom has also announced that it will be carrying out research towards the end of the year, with the results due to be published in spring 2014, to measure the performance of 3G and 4G networks. This research will be broken down by operator and will assess the average mobile broadband speeds received by 3G and 4G customers.

It is expected that the winners of the auction will begin launching 4G services within the next six months.

Ofcom has also said today that by 2030 demand for mobile data could be up to 80 times higher than today, and to help meet this demand, it is now planning to support the release of further spectrum for possible future 5G mobile services.

Everything Everywhere is the only mobile operator to already offer 4G services, after Ofcom ruled last year that it could use its existing 1800 MHz spectrum, which had been previously used for 2G services, for next generation mobile broadband services.

 

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