Ofcom auctions off high frequencies
Bargains snapped up by companies with no firm plans
Ofcom has completed the auction of a handful of microwave frequencies, raising less than £1.5m for the 15-year licences.
The licences allow buyers the freedom to deploy any technology, as well as sell the spectrum if they wish.
The bands that changed hands are all between 10 and 40GHz - more suitable for point-to-point connections than the mobile broadband services that could be launched in the next few years as a result of the digital dividend, which will release frequencies at a much lower band.
At least one company, Arqiva, is betting that those new networks are going to need lots of backhaul, and it's invested £250,000 in a couple of 224MHz blocks around 28GHz to provide that backhaul - despite admitting it has no idea what kind of technology those new networks will use.
BT spent almost £200,000 on a pair of 126MHz chunks in the 32GHz band, which are also suited to microwave connections between companies or company branches.
These frequencies are highly directional, so one license can be used to provide hundreds of links around the country - as long as they're not physically too close to each other. Most of the buyers seem to be planning similar kinds of services.
Standing out from the crowd is Transfinite, which doesn't intend to deploy any connections in the pair of 112MHz chunks it's bought regional licenses for, in the 28GHz band. Its intention is to sub-licence to anyone who wants to set up their own connection. For a small fee the firm will ensure you have an interference-free link between your own offices, assuming you have line-of-sight, but leave you to build the connection yourself.
Ofcom currently licenses more than 40,000 individual microwave connections, and the regulator would rather just licence a chunk of spectrum and leave the individual-connection handling to a company like Transfinite - so its success will be watched with interest.
Come 2023 (in 15 years), the spectrum won't automatically fall back to Ofcom. The decision about what happens to it then hasn't yet been made. Ofcom would like to see spectrum licensed in perpetuity, like land, but isn't prepared to go that far this time round, so the buyers will be looking to make their money back over the next decade and a half, with any future holding being a nice bonus. ®