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

    Comment number 136.

    "...the spectrum needed to bring fast new mobile phone services..."


    Why does the BBC give free selling for these would-be companies?

    The claim will probably only have any truth while it is indeed new. As and when use becomes widespread, the system will become clogged, just as the present one has.

  • rate this

    Comment number 135.

    A fellow who's been preachung austerity shouldn't have expected any more!

  • rate this

    Comment number 134.

    Simply put - it may be faster but that does not make it more expensive by default. The market obviously thought so on the day, too.

    We should be pleased it went for more than £1 billion less than the asking price, because it should mean the end service is CHEAPER (I said *should*, not will!! ;) ).

  • rate this

    Comment number 133.

    131. Pizik - "Isn't it 2.6Ghz, not Mhz?"

    It's neither. It's 2.6GHz.

  • rate this

    Comment number 132.

    why can't we just have a public wifi network? Many cafe's/fast food restaurants and department stores offer free wifi. Couldn't the government just set up a wifi router on every traffic light on the street, then we'd all be covered? (maybe I am viewing this over simplistically...)

  • rate this

    Comment number 131.

    Isn't it 2.6Ghz, not Mhz?

  • rate this

    Comment number 130.

    I am pretty sure they will find a price fixing by the telecom companies on the Bid process some time in the future just llike how the barclays bank debacle for libor rates happened. Just shows how incompetent gov is

  • rate this

    Comment number 129.

    127 ravenmorpheus3k

    I think this particular blog entry suffered somewhat from running concurrently with the one in the business section, albeit this one comes at it from it from the technological, rather than the business action.

    On the technological side, there's not a lot to say that hasn't been said many times before. The only surprise was on the business side.

  • rate this

    Comment number 128.

    Video calling failed for one simple reason. Network providers did not include video calling as part of their standard contract minutes, but charged a premium for each call on top. So no-one used it.

    3G failed because coverage was dire anywhere that was not a big city. Hopefully they will invest more in 4G coverage so we can all enjoy the data revolution, and maybe even video calls. Maybe.

  • rate this

    Comment number 127.

    Hmm. Comment numbers are down on Rory's Blog recently. Ever get the feeling you're not being read Rory?

    700+ comments - http://www.bbc.co.uk/news/business-21516243
    500+ comments - http://www.bbc.co.uk/news/technology-21526450

    And one of those has been open less than a day.

    Perhaps the BBC ought to review your brief, much like the govt. should review it's handling of the 4G contracts...

  • rate this

    Comment number 126.

    4G, what's that- let's have 3G first!

    I can only get reliable 3G (O2) in my loft! Had to buy and install a signal booster but, still only patchy at ground floor level. And- we live less than 2 miles from Inverness (International) airport!!

  • rate this

    Comment number 125.

    I think 4G is going to take time to bed in. The providers burned their fingers with 3G, which was sold to us as the medium for video calling. It took smartphones to deliver us a device that usefully uses that bandwidth.

    While speed is always better, I do not yet know why I would need better than the 5mb to 10mb 3G speeds I get in the South East (with apologies to the not spots, not boasting....)

  • rate this

    Comment number 124.

    Because no one wanted to pay any more than they offered?

  • rate this

    Comment number 123.

    I live on the outskirts of a British city and get a poor and patchy signal.

    So rather than focussing on 4G these companies should spend a few of their billions on finishing the 3G job.

  • rate this

    Comment number 122.

    As a 4g customer myself I do feel we are paying a premium for being early adopters. But then again I can now use data reliably and quickly in London. Well worth paying for I would suggest if you happen to be in or visit london regularly!

  • rate this

    Comment number 121.

    Orange/EE may have 4G and lead the way with a technology that is yet to find a substantively better use than 3G; but with their customer services you feel like you are dealing with a bunch of idiots (in several different places).

    In a recent call to their 150 number I was told to wait as their call centre stopped to sing "Happy Birthday" to their section leader....

  • rate this

    Comment number 120.

    I'm with Vodafone. I don't yet get 3G where I live (which is within 20 miles of Birmingham city centre), and even plain old signal of any kind is patchy - I have to walk around to pick up signal more often than not. Chances of getting 4G? Nil

  • rate this

    Comment number 119.

    I assumed it was that they learnt their lessons from the 3G auction in which they paid far far more than what was expected...

  • rate this

    Comment number 118.

    3G/HSDPA provides a reliable and fast service throughout most of the country. Why would people pay considerably more, have measly data allowances and be unable to use 4G unless they lived in the middle of a major city? It's no wonder uptake has been slow.

    As 4G becomes more widespread and competition drives down prices, then we'll see a greater uptake. The technology just needs time to mature.

  • rate this

    Comment number 117.

    88. David H

    you are correct. it is a joint venture between FT and DT (Everything Everywhere like i said). However, EE is 1 brand, operating on 4G. Orange is another brand, operating at 3G and below, same as T-Mobile.

    Customers of all 3 will see EE as the network name on their phones, but that doesnt mean they are all EE, just that EE, Orange and TM use parts (different parts) of EE network


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