Operator consolidation could part-delay UK spectrum auction

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Ofcom update on spectrum auction moots possibility of delaying part of auction of 2.3Ghz and 3.4Ghz bands

Ofcom has asked the mobile operators to comment on proposals that could see part of an auction of Ministry of Defence spectrum delayed until after the potential consolidation in network operators.

The auction, due to be held later this year or in early 2016, will see 38 lots of the 2.3Ghz and 3.4Ghxz bands being made available to interested parties. It is expected that mobile operators will bid for the 20-year licences which would improve capacity on their 4G networks. The auction is expected to raise up to £70 million for the public purse.

However, Ofcom is now asking the operators, and other interested parties, to comment on whether part of the auction should be delayed until after the possible BT/EE and Three/O2 mergers. As part of competitions approval for these deals, some of the operators may have to divest of some of their existing spectrum.

Operators may also prefer to wait until the deals are completed before making any network investment decisions.

“Today’s consultation invites potential bidders to comment on an option where Ofcom would award most of the newly available spectrum later this year, or early in 2016,” said a statement from the regulator.

“The remaining frequencies would be held back for award at a later date. This approach may be preferable to the alternatives of either awarding all of the spectrum, or delaying the award – although both those options remain open. Ofcom will determine later in the year the best approach to making the spectrum available, following stakeholder responses and the condition of the market.”

The closing date for comments on the auction is 26 June.

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