4G: The results are in

 
Smartphone user En route to faster data?

The prize was, in theory, extremely valuable - the spectrum needed to bring fast new mobile phone services to customers across the UK. But at the end of a complex bidding process, the 4G auction has raised £2.34bn - about a 10th of the price paid at the 3G sale 13 years ago at the height of the dotcom bubble. It's also more than £1bn short of what the chancellor estimated in his autumn statement.

Ofcom is, however, congratulating itself on a smooth auction process, with no leaks during the secret bidding rounds over the past month. The regulator says it was not its job to extract the maximum price for the Treasury, but to secure the best possible outcome for consumers.

So Ed Richards is pleased that along with the four existing operators - Vodafone, O2, EE and Three - the winners include a new player, Niche. You may not have heard of this company, but you'll know its owner BT.

Britain's biggest telecoms provider got out of mobile phones a decade ago when it sold off Cellnet, which became O2. Now it is back with a healthy chunk of the 2.6Mhz spectrum which is best suited to handling high data traffic in cities. BT is stressing that it is not planning to operate a national mobile network, but will be using its spectrum to boost its fixed and wi-fi networks for businesses and consumers.

Why was the bidding so low?

Rory Cellan-Jones reports on the 3G auction in April 2000

Perhaps because the bidders had watched the experience of EE, which was allowed to launch its 4G network early. Despite a very high profile advertising campaign, results yesterday appeared to show that its customers had only a limited appetite for the new service. (I speed-tested the 4G network last October.)

Even if the Treasury is disappointed, the auction may be good news for the 4G rollout. We can now expect plenty of competition to offer fast new mobile services across the UK. But those people in 3G "notspots" will be hoping that this time they will not be left out of the faster future.

 
Rory Cellan-Jones Article written by Rory Cellan-Jones Rory Cellan-Jones Technology correspondent

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  • rate this
    -1

    Comment number 56.

    it came in under expectations because the OBR is scared of upsetting the government that formed it and to please mr osbourne not reality , just plain incompetense really

  • rate this
    0

    Comment number 55.

    Faster Broadband = More people walkign around with heads bowed looking at small screens

  • rate this
    +1

    Comment number 54.

    No-one offers a suitable data allowance, limited range of supported devices, and crucially no-one has yet come up with something that doesn't quickly run out of battery when you try to do much on it.

    Its purpose is somewhat limited so it's no surprise to see lower interest than expected.

  • Comment number 53.

    All this user's posts have been removed.Why?

  • rate this
    0

    Comment number 52.

    What people actually want is not what the mobile companies tell us we need. Most people (incl. me) simply want to close their eyes & relax with their MP3 player during the commute. I've NEVER seen anyone watching a film. The closest has been people reading their Kindles or playing a game. Forget this nonsense about watching films on your phone/tablet whilst on-the-go and just give us lower bills!

  • rate this
    0

    Comment number 51.

    Whats the point. Vodafone still only offering 2GB data on 4G. I you do actually manage to get a high speed connect 2GB will go in a sort time. Ill be sticking to 3G as it can only get better as people fall for the 4G trap. All the mobile operators fail to deliver

  • rate this
    +2

    Comment number 50.

    I work in telecoms and I watched closely as UK governments plundered £30Billion for 3G spectrum in early 2000's -a sum fueled by mindless investment speculation. The result was a significant reduction in investment combined with massive redundancies for the next decade. I'm not sure whether operators ever got an ROI on 3G. Certainly, the industry is much less healthy today and less gullible.

  • rate this
    +2

    Comment number 49.

    or the bidders got together and shared bids to push the price down?

  • rate this
    +8

    Comment number 48.

    4G or #4GEE as EE have branded it hasn't had a large uptake because of the small data limits you are allowed to use as part of your tariff. The advertising campaign talks about watching movies on the go, how many movies can you watch on the go with a 1GB monthly download limit, 1, half?

    iphone 5 with 500MB of internet is £36 for 24 months, no wonder people aren't signing up!

  • rate this
    +3

    Comment number 47.

    If all the big players plus BT were able to buy licences then I can't see any incentive for increasing their bids. Surely selling the rights of something where supply outstrips demand is always going to result in a low price?!

  • rate this
    +3

    Comment number 46.

    @33 Gio

    Couldn't agree more. Typical short termism from whoever is in government

  • rate this
    0

    Comment number 45.

    Selling licences for radio spectrum feels wrong.. but does do one very good thing. The point is in the 3G selloff the debt incurred was used to offset the tax paid later on. So the treasury didn't really gain much... except the money was guarenteed to end up in our treasury, not a different countries who had looser tax laws. We should require licences to sell coffee, offsetable againts tax.

  • rate this
    +3

    Comment number 44.

    All the main players got what they wanted at a knock down price. One might almost be led to believe they colluded in the bidding process.

  • rate this
    +1

    Comment number 43.

    @35

    The govt control the land, everything on it and the airspace above it. It makes perfect sense.... Why is it so hard to understand when it comes to radio?

  • rate this
    0

    Comment number 42.

    For those people who feel that they've been left out of mobile coverage and live in a "not-spot". The really important thing isn't the 4G technology but the frequency they will be running on. The new frequencies penetrate buildings better and can travel greater distances so chances are you will finally see broadband speeds years before BT finally gets to you!

  • rate this
    +2

    Comment number 41.

    4G will be available only in certain parts of UK. The sad fact is there are many parts of UK where normal mobile coverage itself is bad. Perhaps that could be due to low number of subscribers.

    Having said that, we as a country are moving in the right direction, although, slowly.

    Perhaps, the bidders want to use the £1bn for upgrading infrastructure. Isn't the money better spent there?

  • rate this
    0

    Comment number 40.

    35 Mark

    How else would you allocate/regulate it? Give it to the bidder who pledges to provide the greatest coverage?

  • rate this
    0

    Comment number 39.

    Perhaps it's because more people are realising that mobile phones are moderately useful but thoroughly dull little devices that are not worth getting excited about.

  • rate this
    +2

    Comment number 38.

    I am not sure that there is a market out there for 4G. There is hardly a huge rush for rural UK to get broadband at any speed without a large amount of subsidy.

  • rate this
    0

    Comment number 37.

    It just shows that Governemt would happily charge anyone for anything including the air we breathe if they could. This time I think they've been played by the telecom companies who have decided to reduce their bids to ensure that the previous problem of massive overspending on licenses does not reoccur.

 

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