Ofcom finalises 4G auction rules

12 November 2012

Ofcom has today published final regulations and a timetable for the 4G mobile spectrum auction - the largest ever sale of mobile airwaves in the UK.

This new spectrum will be used to deliver superfast 4G mobile services to people in cities, towns and villages across the UK and will almost double the amount of airwaves currently available to smartphones and tablets that use 3G networks.

The rules set out in detail the process involved in the auction - from applying to take part, through to bidding and finally issuing the licences to use the spectrum. Ofcom has also today confirmed reserve prices for the different lots of spectrum on offer and outlines the timetable for the auction process.

Ed Richards, Ofcom Chief Executive, said: "Today marks an important shift from preparation to the delivery of the auction, which will see widespread 4G mobile services from a range of providers.

"The entire industry is now focused on the auction itself, with a shared goal of delivering new and improved mobile services for consumers."

Reserve prices

Ofcom has confirmed the reserve prices for the spectrum that is being auctioned. The combined total is £1.3 billion.

Application date set

Ofcom has also announced 11 December as the provisional date for the submission of applications by prospective bidders. Ofcom will confirm the date in two weeks time, once the regulations have come into force.

Chronology for auction

11 December: The application day

Prospective bidders submit their applications to Ofcom together with an initial deposit.

December: Qualification stage

Applications are reviewed to determine who can go on to bid in the auction.

January: The principal stage

Bidding begins. This could take a number of weeks. Bids will be placed online over secure internet connections, using software that has been developed specifically for the auction.

February/March: The assignment stage

Bidders informed what they have won and its cost.

February/March: The grant stage

Licence fees are paid and licences granted.

May/June: New 4G services launched

New 4G services expected to go live from a range of providers.

What to expect from 4G

4G services should make it much quicker to surf the web on mobiles - speeds will be nearer to what is currently experienced with home broadband.

Because of this, 4G is ideally suited for high-bandwidth data services such as streaming high-quality video, watching live TV and downloading large files.

For the typical user, download speeds of initial 4G networks could be around 5-7 times those for existing 3G networks. This means a music album taking 20 minutes to download on a 3G phone and just over three minutes on 4G. This is based on existing 3G speeds being 1 Mbit/s on average and 4G speed being 6 Mbit/s (on average between 5 and 7 times faster).

4G consumer information

Ofcom has also today launched a new 4G consumer page, which provides information on the upcoming auction and the consumer benefits that new services will deliver.

Ofcom's full statement on the final regulations for the 4G mobile spectrum auction is available here.

ENDS

NOTES FOR EDITORS

1. Existing 4G services: In August 2012, Ofcom approved an application by the mobile phone operator Everything Everywhere (EE) to use its existing 1800 MHz spectrum to deliver 4G services. This decision was made after conducting a thorough assessment of how competition might be affected. Ofcom concluded that consumers would benefit significantly from gaining early access to 4G services, and that there was no material risk that those benefits would be outweighed by a distortion of competition. EE launched a commercial 4G service in some areas of the UK on 30 October 2012.
2. The term 4G is generally used to refer to mobile broadband services delivered using the next generation of mobile broadband technologies, including Long Term Evolution (LTE) and WiMAX.
3. Ofcom is the independent regulator and competition authority for the UK communications industries, with responsibilities across television, radio, telecommunications, wireless communications and postal services.
4. Ofcom's principal duty under the Communications Act 2003 is to further the interests of citizens, and the interests of consumers where appropriate by promoting competition. Ofcom is also required to secure the optimal use for wireless telegraphy of the electro-magnetic spectrum.
5. In holding the auction and putting in place measures to promote competition, Ofcom is meeting specific requirements under the Government's Wireless Telegraphy Act 2006 (Directions to Ofcom) Order 2010.
6. For further information about Ofcom please visit media.ofcom.org.uk