Government to broker peace talks between Ofcom and operators

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Telecoms regulator Ofcom needs to impress O2 and Vodafone today with its promise to speed up the clearing and auction of 4G spectrum, if EE is to launch this month

This afternoon the four major UK telecoms operators and regulator Ofcom will attend a meeting with newly-appointed culture secretary Maria Miller which will decide the immediate future of 4G services in the UK.

EE are poised to launch their 4G network, but the timing of this is being dictated by O2 and Vodafone, who have threatened to take legal action against Ofcom’s decision to let the Orange, T-Mobile partnership use its spectrum to provide the latest services.

An agreement brokered on September 3 by then culture secretary Jeremy Hunt meant that, until yesterday, Vodafone, O2 and Three could not sue the UK regulator, while EE were prevented from launching their new network during this time.

The four-week stalemate gave Ofcom a chance to review its timetable for the freeing up and auctioning of 4G spectrum, to see if it could bring these forward and narrow the time-gap between EE’s launch and O2 and Vodafone obtaining the frequencies.

Today Ofcom will say they will make sure the 800MHz and 2.6GHz bands up for grabs are ‘cleared’ – meaning they will be free to be used for 4G – as soon as possible.

The current deadline for the freeing up of 800MHz is October 2013. The deadline for clearing the 2.6GHz bands is the first quarter of 2014. The project is understood to be ahead of schedule and so Ofcom may use the meeting with Miller to move these deadlines forward a few months.

The regulator is also expected to say the auction for these bands can be moved forward a few weeks from January, so O2 and Vodafone can get their hands on the spectrum sooner.

It is hoped these two promises will dissuade O2 and Vodafone from taking legal action against Ofcom.

Should today’s meeting go well, and O2 and Vodafone decide not to litigate, EE will launch in the next two to three weeks.

If Ofcom’s offer is not enough, and O2 and Vodafone feel EE’s launch should be delayed as well as their own launch speeded up, the former two may choose to take the regulator to court.

Apart from the legal fees, the operators have very little to lose from doing so as they do not need to win their case to secure a delay in EE’s roll-out.

The operators can request ‘interim measures’ when filing their case at the Competition Appeal Tribunal, which means that while they are preparing their case (this should take a few months) and waiting for it to be examined, EE won’t be able to complete the launch of their 4G network.

However, Vodafone, O2 and Three would be fighting a losing battle as Ofcom’s decision not only complies with EU law on the freeing up of spectrum, it also matches the government’s digital ambitions, hence the intervention of Hunt on September 3.

O2 are sticking by their previous position, which suggests that they will not litigate but press for the speedier freeing-up of spectrum. A spokesperson reiterated: “It’s fair to say that we’re in discussions with the wider industry over 4G spectrum, but this is in an attempt to bring 4G to all UK customers, not to delay the launch of 4G.”

“Even if the auction happened tomorrow, the 800MHz band would not be nationally available for use until October 2013. These frequencies are currently in use for digital television broadcasts.  Clearance of digital TV needs to happen before we can legally make use of the spectrum for 4G.”

“Practical steps need to be taken by the Government before 4G can be launched by the other operators. As a result, we’re talking as a group about the possibility of bringing the auction forward and asking if the frequencies used in the spectrum can be cleared quickly.”

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