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4G auction winners are O2, EE, BT, Three and Vodafone

Auction falls short of government estimates
Wed Feb 20 2013, 10:13
Mobile spectrum antenna

UK TELECOMS REGULATOR Ofcom announced the winners of the 4G auction on Wednesday as O2, EE, BT, Three and Vodafone.

Despite these big name winners the 4G auction raised just £2.3bn for the government, about a third short of its estimate of £3.5bn.

Vodafone handed over the most for both 800MHz and 2.6GHz spectrum, paying £790m, while EE secured blocks in both bands for £588m.

O2 paid £550 million to secure two 10MHz blocks of spectrum at 800MHz in the "coverage obligation lot", meaning it must ensure it covers 98 percent of the population with its LTE connectivity.

O2 CEO Ronan Dunne said, "Today, Telefónica has made a significant investment in next-generation 4G technology for the UK.

"While 4G will indeed allow for faster data speeds and a more seamless mobile experience, it is our intention to go beyond what has already been offered in the market and give our customers a unique and exclusive range of digital experiences, marking a new generation for the mobile industry."

BT paid out £186m for three blocks in the 2.6GHz band while Three, which has said it will offer 4G to its customers at no extra cost, paid £225m for two blocks in the 2.6GHz band.

Three CEO David Dyson commented, "Doubling our capacity allows us to continue our growth with significant headroom to increase our current base of over 8 million customers."

Ofcom chief executive Ed Richards commented on the auction's closure. He said, "This is a positive outcome for competition in the UK, which will lead to faster and more widespread mobile broadband, and substantial benefits for consumers and businesses across the country.

"We are confident that the UK will be among the most competitive markets in the world for 4G services.

"4G coverage will extend far beyond that of existing 3G services, covering 98 [percent] of the UK population indoors - and even more when outdoors - which is good news for parts of the country currently underserved by mobile broadband."

While this is good news for the five 4G auction winners, it's not such good news for the government.

Ovum analyst Matthew Howett said, "Despite all the noise being made about the UK's 4G auction, what you can't hear is the sound of champagne corks popping over at the Treasury as Ofcom's 4G auction fails to raise George Osborne's optimistic expectation of £3.5bn." µ


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