Not just the usual suspects qualify to take part in super fast mobile broadband auction
Ofcom has announced the bidders in the forthcoming 4G mobile spectrum auction, billed as the largest ever sale of mobile airwaves in the UK. As well as the UK's major mobile network operators, several other companies have qualified to take part in the auction. The organisations that have qualified to bid in the auction, which will start in January 2013, are UK operators Everything Everywhere (UK), Telefonica UK, Vodafone and Hutchison 3G UK, and also HKT (UK) Company (a subsidiary of PCCW), MLL Telecom, and Niche Spectrum Ventures (a subsidiary of BT Group). Although in August 2012, Ofcom approved an application by Everything Everywhere to use its existing 1800 MHz spectrum to deliver 4G services, leading to the operator launching a commercial 4G service in some areas of the UK on 30 October 2012, it will also be bidding for these other spectrums on which to expand its 4G network.
On the new entrants in the bid, owner of HKT (UK) Company, PCCW, is a Hong Kong-based company that operates in telecoms, media, IT solutions, property development and investment, and other businesses. PCCW holds a majority interest in HKT, a Hong Kong telecoms service provider that offers a wide range of services including local telephony, local data and broadband, international telecommunications, mobile, and other comms businesses such as customer premises equipment sale, outsourcing, consulting, and contact centres.
MLL Telecom is a UK-based company. Established in 1992 with headquarters in Marlow, Bucks, the business is a supplier of fully managed fixed and mobile networks. It is a licensed UK operator with planning rights, access to BT exchanges and infrastructure and we own our own wireless spectrum across the UK. It designed, built and operated the UK's first successful WiMAX trial, for Maidstone Council as part of the MWAG consortium. The majority of its pervasive wireless networks are used for traffic control systems, CCTV backhaul, enabling healthcare in the community, mobile broadband access (for public sector employees) and wireless VoIP.
Meanwhile, Niche Spectrum Ventures seems to have been created by BT especially for this auction. According to Companies House, Niche Spectrum Ventures was incorporated in England and Wales on 11 June this year, and was formerly called BT Facilities Services Limited, and BT Ninety-Two Limited. Its business activity has not been recorded. Niche Spectrum Ventures Limited is run by two current directors and one company secretary. It has no share capital.
Bidders will be competing to acquire new capacity to roll out superfast 4G mobile broadband services to cities, towns and villages across the UK.
Bidders will be competing for spectrum in two separate bands; 800 MHz and 2.6 GHz. The lower frequency 800 MHz band is part of the 'digital dividend' freed up when analogue terrestrial TV was switched off, which is ideal for widespread mobile coverage. The higher frequency 2.6 GHz band is ideal for delivering the capacity needed to deliver faster speeds. These two bands add up to 250 MHz of additional mobile spectrum, compared to 333 MHz in use today. Both bands are being packaged into smaller lots for the auction.
This combination of low and high frequency spectrum creates the potential for 4G mobile broadband services to be widely available across the UK, while offering capacity to cope with significant demand in urban centres. This new spectrum will boost the amount of airwaves available to mobile phones by more than 75% and will play a critical role in helping to meet a growing demand for mobile data among consumers, said Ofcom. Ed Richards, Ofcom chief executive, said: 'The 4G auction will be a competitive process that will dictate the shape of the UK mobile phone market for the next decade and beyond. New 4G services will stimulate investment, growth and innovation in the UK and deliver significant benefits to consumers in terms of better, faster and more reliable mobile broadband connections.' In July 2012, Ofcom published the outcome of its competition assessment of the UK mobile market. This concluded that UK consumers are likely to benefit from better services at lower prices if there are at least four credible national wholesalers of mobile services. Therefore, in the interests of competition, Ofcom has designed the auction in a way intended to achieve this outcome. For the typical user, download speeds of initial 4G networks will be at least five to seven times those for existing 3G networks. This means a music album taking 20 minutes to download on a 3G phone and just over three minutes on 4G. This is based on existing 3G speeds being 1 Mbps on average and 4G speed being 6 Mbps (on average between five and seven times faster).
Smart Chimps thinks: How exciting! New companies are bidding to get a piece of the 4G action in the UK, one Chinese and two British. It will be interesting to see how things pan out. However, Smart Chimps is confused as to why BT has gone to such interesting lengths to use a separate company to enter the bid. Why not just go in as well known brand, BT? A puzzle for Yule Tide…