updated 11:56 am EST, Mon November 12, 2012
Spectrum auction set to finish before April 2013
UK regulator Ofcom has issued rules for the upcoming 4G spectrum auction in the country. The newly-released timetable will see network operators such as Vodafone and O2 submit bids for spectrum from January onwards, with the combined reserve prices for the 800MHz and 2.6GHz ranges being auctioned totaling over £1.3 billion ($2 billion).
Interested parties can submit applications from December 11, with applicants being reviewed for suitability before bidding begins in January. Bidders will be informed if they have been successful in the auction before April, with winning networks expected to go live in May and June.
Of the main mobile phone networks in the UK, Vodafone and O2 stand to be the main participants in the auction. T-Mobile and Orange already have their own 4G network up and running, in the form of Everything Everywhere. Three, a smaller national carrier that offers purely 3G coverage, has bought part of EE's 1,800MHz spectrum, and is expected to launch its own 4G service next year. While in possession of 4G spectrum, this does not stop them from bidding in the auction, be it to gain more for their own use, or to deny another network from owning some of the spectrum.
While the £1.3 billion reserve pricing may seem high, it is suggested by professional services firm PwC, speaking to TechCrunch, that the auction will hit between £2 billion ($3.2 billion) and £4 billion ($6.4 billion). The 3G spectrum auction that took place in the year 2000 raised £22.5 billion ($35.7 billion), 2.5-percent of the UK's GDP.