3UK Welcomes 4G Auction Plan

Mobile operator welcomes Ofcom’s bid to preserve competition – but still wants redress for earlier decisions

Mobile operator 3Uk, which had complained the 4G spectrum allocation could put it out of business, has welcomed the plans by regulator Ofcom to auction it off with fixed limits.

Three is still not happy about Ofcom’s approval for spectrum re-farming, however. Ofcom has given permission for operators with spectrum originally allocated to 2G mobile services, to offer 3G services, effectively increasing the amount of 3G spectrum held by Vodafone, O2 and Everything Everywhere, the operator formed from T-Mobile and Orange.

‘A clear and strong commitment’

Ofccom’s proposals include minimum amounts of spectrum any operator can get – so that no-one ends up with a holding that cannot offer 4G services, and maxima or “caps” that make sure no operator dominates.

“Ofcom’s proposals set out the core principle that the UK must retain four wholesale mobile operators,” said a statement from 3UK, which compared the UK’s situation with the US, where AT&T’s proposed acquisition of  T-Mobile USA – if approved – will reduce the number of operators from four to three.

“Against a background of consolidation in the UK and US this is a clear and strong commitment from Ofcom and the UK Government that will stimulate investment in mobile broadband and protect UK consumers,” said the statement.

However, it reiterated the operator’s opposition to Ofcom’s blanket approval for re-farming by opertors who hold 2G spectrum, and suggested that 3UK will continue to push for some sort of redress for that decision.

“The January 2011 re-allocation of 2G spectrum has given a huge competitive advantage to Vodafone, O2 and Everything Everywhere,” the statement continued. “Ofcom’s proposals seek to rebalance this in the medium term but there are still immediate distortions that need to be addressed. These include significant coverage, capacity and financial benefits.”