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Ofcom saves piece of 4G spectrum pie for '4th operator'

Three could disturb Big 3's threesome when auction starts at end of 2012

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UK regulator Ofcom said today that the spectrum auction for 4G services would start on time at the end of this year, although actual bidding won't start until early in 2013, and it's holding back a chunk of the spectrum from the big three operators.

Ofcom announced that it would reserve a portion of the spectrum up for grabs for a fourth operator, so that Everything Everywhere (Orange and T-Mobile), Telefonica (O2) and Vodafone couldn't have all the 4G to themselves, which is good news for Hutchison 3G (Three).

Hutchison has long been campaigning for such a move and although the reserved spectrum is not being held for Three specifically - it will still have to compete with any other operator that could pop up out of the woodwork - it won't have to compete with the big boys to lay hands on some of the current definition of 4G. The other operators had all been arguing that holding back some spectrum this way would give the firm an unfair advantage.

Spectrum bands 800MHz and 2.6GHZ are up for grabs in the auction, although each of the big three bidders will have a cap on how many chunks they can gobble as well as having one chunk off the table for a fourth operator.

Ofcom reckons that mobile operators will be able to start rolling out their services by the middle of next year and then offer the service to customers by late 2013. Ultimately, the regulator wants at least 98 per cent of the UK population covered indoors by the end of 2017 at the latest.

The 4G auction was originally supposed to happen two years ago, but it's been delayed and delayed by the bickering between the operators, each trying to get the jump on each other while trying not to let the others get the jump on them.

Everything Everywhere wants to launch 4G on its own ahead of the auction on its existing 1800MHZ spectrum and Ofcom has indicated it might be willing to let that go ahead, despite the protests from the others. But no official decision has been made on EE's request yet and as the auction edges closer, the benefits of launching early on a different spectrum diminish for the operator.

Ofcom is not seeing the auction's move to the end of 2012 as a further delay, although with actual bidding not taking off until 2013, many others are.

However, even if a 4G network comes online by the end of 2013, the UK will still be years behind countries like the US and Australia. ®

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