Ofcom pushes back 4G spectrum auctions to first half of 2012

Ofcom has delayed the auctions for spectrum holdings for 4G services to ensure that the proposed system is sufficiently robust to meet the demands of stakeholders.

Auctions for the 800MHz and 2.6GHz holdings were scheduled for the first quarter of 2012, but this has been extended to the first half of 2012 to give Ofcom more time to prepare the document outlining the auctions.

The move is due in part to a veiled threat of legal action by operators including O2, which had argued in its response to Ofcom's consultation on the auctions that using spectrum floors constitutes state aid for Everything Everywhere and Three.

A spokesperson for Ofcom admitted that technical and regulatory challenges had forced the regulator to revise its auction timetable, but insisted that eventual rollouts will occur by the originally envisioned time.

"This is a complex area, involving a large number of technical and competition issues that we need to consider and resolve before finalising proposals," the spokesperson said.

"Because these technical issues need to be resolved before new networks can be built, it will not be possible for mobile operators to start rolling out 4G networks until 2013 at the earliest regardless of when the auction actually takes place."

The delay could still be a blow to Three, which needs new spectrum to meet growing demands on its network from data-hungry smartphone customers.

The firm's chief executive, Dave Dyson, lamented the delay, claiming it played into the hands of operators with 2G holdings and could damage the potential benefits of mobile broadband.

"There is a growing realisation of the role mobile can play in meeting the government's broadband commitment by 2015. Any significant delay risks impacting this and will further weaken competition to the detriment of UK consumers," he said.

"Refarming 2G spectrum without any of the reallocation seen across Europe created an incentive for those gifted spectrum to delay the auction. Ofcom and the government need to ensure their plans are not undone by narrow self interest."

Other operators have been given the right by Ofcom to use 2G spectrum holdings for 3G services to ease data congestion, but Three has no 2G holdings and is reliant on 4G services.

The rollout of 4G services will enable smartphone and tablet users to access speeds of 30Mbit/s and upwards when mobile and from 100Mbit/s when stationary. 4G is likely to form a vital part of the government's commitment to getting 90 per cent of the nation connected with superfast speeds by 2015.