Ofcom’s revised proposals for 4G auction criticised – 20/01/2012

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Posted in:Corporate and Commercial|January 20, 2012 | Join the mailing list

The Office of Communications has come under fire as a result of its recent negotiations with various telecoms providers. Everything Everywhere ("EE"), the operator for both Orange and T-Mobile, criticised Ofcom’s recent decision
not to grant EE a minimum amount of 800MHz spectrum.

As part of the plan to deliver high-speed broadband access across the UK, telecoms providers will bid for an allocation of two bands of spectrum, 800MHz and 2.6GHz. These two bands have been internationally harmonised for next
generation mobile broadband use. Between the two bands, the lower frequency 800MHz band is ideal for widespread mobile coverage for areas with poor signal reception, whereas the higher frequency 2.6GHz band has the capacity to deliver high-speed connectivity
for faster wireless access and activity.

Within the original plans, Ofcom had essentially guaranteed EE that it would allocate a certain percentage of "sub 1GHz" spectrum. This led to protests from both Vodafone and O2, who criticised the move as having provided "illegal
state aid" to EE. O2 threatened to take legal action against the proposals, which had also guaranteed a share of the 4G spectrum to Three.

Under the new proposals, Ofcom’s plans could require telecoms companies to provide up to 98% of the UK with the next-generation 4G mobile coverage should they participate in the purchase of 800MHz spectrum available.

For smaller providers such as Three, Ofcom have confirmed that they will reserve a percentage of the 4G spectrum allocation to be granted to a fourth national wholesaler. In a recent statement, Ofcom stated that "Ofcom continues
to believe that consumers are likely to receive better services at lower prices in the future if there are at least four national wholesalers of mobile services.".

EE has not commented whether it would take legal action. However, according to the shadow minister for the digital infrastructure Chi Onwurah, due to previous delays, the Coalition government may be unable to comply with its guarantee
to provide superfast broadband by 2015.

The new proposals will be scrutinised in a 10-week consultation period, after which Ofcom will announce its timetable for the 4G auction.

To discuss how we can provide further advice in connection with these issues, please contact Keith Kennedy, a Partner in our Corporate Team, by email to
keithk@berg.co.uk or alternatively you can call Keith on 0161 833 9211.

The information and opinions contained in this article are not intended to be comprehensive or to provide legal advice. No responsibility for article’s accuracy or correctness is assumed by Berg
or any of its partners or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of the contents of this article.

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