updated 05:04 am EST, Wed February 20, 2013
Total of 4G auction winning bids lower than anticipated
UK regulator Ofcom has closed its 4G spectrum auction earlier than anticipated. Mainstream British carriers Vodafone, Telefonica, Everything Everywhere, and Three, as well as BT subsidiary Niche Spectrum Ventures, have won various sections of the 800MHz and 2.6GHz spectrum bands, though the money earned by the UK Treasury through the auction is far below what it expected.
Vodafone bid the highest amount of all participants, spending over £790 million ($1.2 billion) for the largest collection of bands, with Everything Everywhere and Telefonica paying £589 million ($903.1 million) and £550 million ($843.3 million) respectively. Hutchison 3G, operating as Three in the country, paid £225 million ($344.9 million), while NSV on behalf of BT had the cheapest winning bid, at £186 million ($285.1 million). HKT (UK) Company and MLL Telecom were named in the auction, but did not have a winning bid.
While Ofcom expects carriers to complete their 4G networks within six months, only one lot of 800MHz spectrum had a coverage requirement. Telefonica is obliged to provide a mobile broadband service with indoor reception to at least 98-percent of the UK population by the end of 2017.
The total proceeds of the auction, £2.34 billion ($3.61 billion), is a significant amount lower than the £3.5 billion ($5.4 billion) expected by the UK Treasury. In the year 2000, the UK's 3G spectrum auction raised £22.5 billion ($35.7 billion), 2.5-percent of the UK's GDP.