Vodafone, O2 May Bid for Additional U.K. Spectrum in First Quarter of 2012
Vodafone Group Plc and Telefonica SA’s O2 unit will be able to bid for additional frequencies for high-speed data services in the first quarter of 2012, after a U.K. regulator set a timetable for spectrum auctions.
Ofcom, the telecommunications regulator, will publish a consultation and proposals for the auction at the end of February 2011, Chief Executive Officer Ed Richards said today at the FT World Telecoms Conference in London. Bidding will take place in the first quarter of 2012 and the frequencies will be available for use in 2013 after the auction, he said.
Operators in the U.K. including Hutchison Whampoa Ltd.’s 3 division and the newly merged units of Deutsche Telekom AG and France Telecom SA are seeking access to additional mobile spectrum to cope with increasing demands for data.
“History is littered with concerns, disagreements and some litigation,” Richards said. “We can’t rule out further challenges to these proposals.”
The timetable comes after the sale was delayed by more than two years. In July, the U.K. government said the auction would take place at the end of next year. Ofcom had initially planned to award some spectrum in September 2009, followed by an additional award of frequencies made available by the ending of analog television signals.
German Auction
The U.K. auction will follow the sale of spectrum in Germany and India this year. The German auction raised 4.38 billion euros ($5.96 billion), while frequencies for third- generation mobile networks in India were sold for $14.6 billion.
“It’s a straightforward way of determining who values the spectrum most highly,” Richards said.
Telefonica today questioned the length of time needed for spectrum to become available after the auction. “The time between the auction and the product going live to me feels like a big gap when the technology is available,” Telefonica Europe Chief Executive Officer Matthew Key said at the conference.
Ofcom has started an assessment of competition in the market and will consider restrictions on bidding, Richards said.
O2 and Vodafone last month lost a U.K. court bid to start using their second-generation wireless spectrum for newer smartphones such as Apple Inc.’s iPhone to improve data capacity.
To contact the reporter on this story: Jonathan Browning in London jbrowning9@bloomberg.net.
To contact the editor responsible for this story: Vidya Root at vroot@bloomberg.net.
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