01/02/2010

2.6GHz Spectrum Auction delayed until 2011

2.6GHz was going to be the figurehead of Ofcom's spectrum auction policy. It would be auctioned on a technology neutral basis with at least a national license allowing the possibility for innovative new 3G services, LTE or even WiMAX (i.e. a technology neutral basis). Ofcom would be the regulator that other countries would strive to follow. This was all going to happen in 2007.

The 2.6GHz band was originally allocated as a IMT-2000 (i.e. 3G) 'expansion band' and Ofcom might have allocated it to a 6th operator had the 5th 3G operator (i.e 3) failed.

Unfortunately things didn't go to plan and T-Mobile and O2 (both UK bits) challenged Ofcom that a realistic price could not be set unless Ofcom determined what would happen with GSM spectrum refarming (the current licenses only allow 900MHz to be used for GSM, the GSM operators wan to use it for 3G and the PCN operators i.e. Orange and T-Mobile think they should get some of it). The situation is further muddied as the MNO's with 900MHz spectrum say they should have access to 800MHz spectrum if they give up some of their valuable 900MHz. The reason 900MHz (and 800Mhz which is currently analogue TV) is so valuable is that it has very good transmission characteristics and goes into buildings well, while 1.8GHz (PCN) and more so 2.1GHz (3G) radio signals tend to get absorbed by concrete etc.

The situation has subsequently got even more complicated with the proposed merger of Orange and T-Mobile which would break existing spectrum caps.

BT are also interested in the 2.6GHz band as they could deploy WiMAX in rural areas and 3G services in urban areas. The WiMAX service would allow them to provide high speed broadband connections to communities where fibre/VDSL wont reach and in urban areas where they have good broadband coverage, they could offer their own 3G services to compete in the mobile business markets.

It was hoped that the auction would take in 2010, but now it seems 2011 is the earliest possible date and Ofcom still have a lot of mess to clear-up.
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