Ofcom to undertake a Strategic Review of Digital Communications

Ofcom, the Super Regulator, is holding a Strategic Review of Digital Communications to promote competition and investment in converged digital communications services.

This is mainly concerned with infrastructure services such as broadband, but will also cover mobile 4G and future 5G services and "over-the-top" services (i.e. services deliver on top of Internet services such as VoIP, messaging systems such as WhatsApp which is replacing SMS, etc).

Ofcom last held a review 10 years ago after BT's infrastructure operation was separated into a distinct entity (BT Openreach, though still part of BT Group).

There have been many changes since the last review such as the merger of T-Mobile and Orange into EE (which has subsequently been purchased by BT) and consolidation in the ISP market (02, Tiscali, AOL, Be, Easynet).

Since 2005

• broadband adoption has increased from 31% to 78%
• take-up of bundled services has risen from 29% in 2005 to 63% today
• significant commercial and public sector investment in superfast broadband has resulted in 78% availability five years after deployment started. Adoption of this new service is now 27%
• mobile broadband availability has increased significantly, with 3G increasing from 82% to 99% of premises, and 4G services available to 73% of premises. Mobile broadband take-up is now 67%
• new entrants have shown strong growth in some areas (for example, local loop unbundling now accounts for 44% of broadband connections, up from 17% in 2005)

While Ofcom can not predict the overall output it will likely encompass

• Efficient investment: How can incentives for efficient private sector investment and innovation be maintained and strengthened, to ensure widespread availability and high quality of service?
• Competition: What should be the focus of competition policy in future networks (the 'enduring economic bottlenecks')?
• Deregulation: What is the scope for deregulating networks and services downstream of any 'enduring bottlenecks'?

Ofcom is planning to complete the review by Summer of 2015.

Everything Everywhere sells spectrum to Three (but they cant use it)

Everything Everywhere (EE) the combined company made up to Orange and T-Mobile has sold off some of their 1800MHz spectrum to Three UK (3). The terms of the deal have not been specified.

EE has 2 x 60 MHz bands in 1800MHz and they were forced to relinquish some of this spectrum by the European Competition Commission (2 x 15 MHz chunks) and they have no done this by selling it to 3.

However there's a twist as 3 won't actually get hold of the spectrum until 2013 (which is pretty much the maximum time frame the Competition Commission allowed), which gives EE a whole year to offer 4G (LTE) services in the 1800MHz band and be a UK monopoly for 4G services (Ofcom granted EE a license variation to allow 4G services in EE's 1800MHz band earlier this week).

All of the other mobile network operators have cried foul play as they have to wait for spectrum to become available in 800MHz and 2.6GHz as part of the digital dividend, but Ofcom won't auction the spectrum until 2013 and it's not expected to be available until at least the end of 2013.

By offering LTE services it's likely devices such as the iPhone 5 and other smartphones and tablets will be able to use these frequencies as they're already used in Australia and some Asia Pacific countries. Though UK Broadband is also offering LTE on their spectrum, it's in a band that's not commonly used for LTE and they are having specific devices made to use it.

Everything Everywhere is allowed to offer LTE services

Everything Everywhere the merged efforts of Orange and T-Mobile have been allowed by Ofcom to operate LTE (Long Term Evolution) or 4G services in its 1800MHz spectrum.

All of the other Mobile Network Operators (MNOs) didn't want EE to be able to do this, but Ofcom have decided that it's in the public interest for them to do so, even though it may give EE a short-term competitive advantage. O2 have published their disappointment in this result.

EE currently have 2 x 60 MHz bands in 1800MHz though under the agreement with the competition commission they have to divest 2 x 15 MHz as part of its merger (leaving them with 2 x 45 MHz). Ofcom have allowed EE to utilise LTE on the full bands, not just the bands that EE will retain after the digital divide auctions expected next year (Ofcom will auction the 800MHz and 2.6GHz bands and EE's spectrum will become available as part of this).

It is rumoured that devices such as the iPhone 5 will be able to use LTE services in this band, so EE will be the only UK operator that allows full use of the iPhone's data capabilities.

Ofcom has also published a statement on the interference of LTE in the 800MHz bands which could affect TV services in the future, though their testing has shown that actual interference should be minimal for real use scenarios.

Ofcom's full statement is here.

Ofcom announces 4G auction

Ofcom the super regulator has published a statement on the forthcoming 4G auction of 800MHz and 2.6GHz spectrum.

The 800MHz spectrum has become available due to the switching off of analogue television services (the digital divide) while 2.6GHz was reserved for future IMT-2000 (3G) services.

The 800MHz spectrum will be auctioned as 2 x 30 MHz blocks (paired spectrum) while the 2.6GHz band will consist of 2 x 70MHz blocks and a 50 MHz single (unpaired) block. This spectrum amounts to an 80% increase on all spectrum allocated to date.

Existing spectrum holders can bid for increased allocations, though spectrum will be reserved for a new entrant (i.e. one that isn't Telefonica O2, Everything Everywhere and Vodafone), this new entrant could be Hutchison 3G (who currently do not have any 2G i.e. sub 2 GHz spectrum.

The 800MHz licensee will have to meet 98% indoor coverage which implies 99.5% outdoor coverage, by 2017. The licensee will also have obligations to cover 95% of the populations of England, Scotland, Wales and Northern Ireland.

Ofcom will not reserve any spectrum for low power localised services, though a low power provider can apply for a national license.

Ofcom is reserving spectrum portfolios for a new entrant, these are

Portfolio	800 MHz	1800 MHz	2.6 GHz
1	2 x 15 MHz
2	2 x 10 MHz		2 x 10 MHz
3	2 x 5 MHz	2 x 15 MHz
4		2 x 15 MHz	2 x 20 MHz

EverythingEverywhere have to relinquish 2 x 15 MHz paired spectrum as part of their arrangements with the EU when they combined T-Mobile and Orange. Ofcom have considered the request from EverythingEverywhere as to allow them to ref arm their 1800 MHz spectrum for LTE us independently from this spectrum auction and will announce its results later this year.

Ofcom has published a draft legal document which implements the auction rules, the consultation will close on 11th September 2012.

Ofcom will invite application to bid before the end of 2012 with the auction starting in 2013 and licenses awarded in March 2013.

Winners of spectrum are expected to roll-out LTE services on the new spectrum starting in the middle of 2013 with consumer services being available after that.

Ofcom Telecom Complaints Q1 2012

Ofcom the Super regulator that covers telecoms, broadcasting, spectrum, media and the postal system has released details about Telecoms complaints in the period January through March 2012. This covers fixed line telephone, fixed broadband, mobile telephony and Pay TV services. Ofcom itself receives around 300 complaints per day, usually when a consumer can not resolve an issue with the relevant supplier. These reports are logged, while there are many more issues reported to the suppliers themselves that Ofcom never gets to hear of. Fixed line telephony: BT Retail, Sky, TalkTalk Group and Virgin Media of which TalkTalk had the highest number of complaints with Virgin Media receiving the least number of complaints. Most complaints related to billing and customer service issues. Fixed broadband: BT Retail, Sky, TalkTalk Group, Virgin Media and Orange Home. Again TalkTalk had the most complaints and Sky the least mainly about line faults and other service issues. Mobile telephony: 3UK, O2, Orange, T-Mobile, Vodafone and Virgin Mobile with Three getting most complaints and O2 least relating mainly to disputed charges and customer service issues. Pay TV services: Sky, BT Vision, and Virgin Media with Sky getting the least complaints and BT Vision the most mainly relating to their sales processes and problems with billing. The Ofcom summary can be found here.

Mundio seeks an injunction against EE

Mundio Mobile is a pan European Mobile Virtual Network Operator (MVNO) that operates using the T-Mobile Mobile Network Operator (MNO) network. Mundio operates the MVNO under the Vectone brand in the UK. T-Mobile combined with Orange in the UK to form Everything Everywhere (EE) in 2011 and after the merger they decided to consolidate operations and remove excess network infrastructure (such as radio masts) which should give them savings of around £3.5 billion by 2014. Mundio Mobile gained a low power GSM license in the UK through it's acquisition of Mapesbury Communications several years ago, which gave them a full GSM license (and entry into the GSMA). Now Mundio is seeking an injunction against EE to stop the consolidation ahead of a full trial next March to determine who is liable for any service disruption, and whether EE will be held to “specific performance” guarantees the court could impose. Mundio say the consolidation has caused it's users to receive poor or no coverage. EE wouldn't comment as the case is a current 'legal matter'.

It's not T-Om it's Everything Everywhere

Orange UK and T-Mobile UK will be officially joined at the hip on July 1st when the networks are combined with UK roaming between networks. The new company name is Everything, Everywhere which CEO Tom Alexander said "is their name, vision and ambition". T-Om (T-Mobile - Orange Mobile sounds better though), both the ORange and T-Mobile brands are being retained.

The combined company will have over 700 retail stores and command 37% of the UK market which equates to over 30m users, O2 come second with 28%, Vodafone with 23%, with 3 having a small percentage.

The networks will be fully integrated, any overlaps combined etc. The reduced management overheads (for the two networks and management teams) is expected to bring savings of around £3.5bn, this on a turn-over of £7.7bn is where it all starts to make financial sense.

If they can combine the best assets of both companies (rather than the worst) they have the potential to keep their combined lead and offer innovative new services in both the mobile and fixed markets (Orange has a reasonably large consumer broadband offering).

T-Morange to build new network?

The new company that is the merged T-Mobile and Orange is thinking about building a brand new network in the UK. This will use equipment from Nokia Siemens Networks and Huawei and will support the frequency range from 900MHz to 2.6GHz (2600MHz).

This will allow the company to take advantage of new or refarmed spectrum that may become available in 2012, it will also allow rapid roll-out of new services based on GSM, UMTS (3G) and LTE (4G).

Neither T-Mobile nor Orange have any spectrum in 900MHz, but they're lobbying Ofcom that Vodafone and O2 should give up some of their spectrum when GSM spectrum can be used for 3G services. Currently the combined spectrum that T-Mobile and Orange own exceeds the license limitations for any single operator.

Ofcom have not yet auctioned 2.6GHz which initially was reserved for IMT-2000 use (the technical name for 3G) and due to various legal issues brought against Ofcom by the mobile operators wont be available now until at least 2012. There's likely to be a lot of interest in this band as it offers the potential high data rates (there's 190MHz of spectrum available). It's likely BT will bid for it as they can use it for WiMAX or other wireless broadband technology in rural areas and 3G services in urban areas as they've wanted to offer business mobile services for a while.

T-Mobile gets the go-ahead to bed Orange

The European Commission has given the approval for T-Mobile (UK) a subsidiary of Deutsch Telekom and Orange (UK) part of France Telecom to merge. The combined mobile network will be the largest in the UK with around 29.5m customers.

The joint company is expected to make large savings in both operational and capital spending.

There are conditions to the deal, they'll still have to support 3 (who use Orange for back-up coverage in the 2G space) and they will have to release some spectrum (2 x 10 MHz by Sept 2013 and2 x 5MHz by Sep 2015) which is likely to be auctioned off.

The Orange and T-Mobile branding will be maintained for 18 months, though they will be combined. If they can leverage the increased customer base and shared network resources, the new combined company may give O2 (Telefonica) and Vodafone some hard competition.

Orange and T-Mobile UK jike non-EU prices

Both Orange and T-Mobile in the UK have hiked their prices to countries outside Europe, some by as much as 100%. Both networks announced the price rises at similar times.

Looks like they're already in cahoots before any official joining of companies.

T-Mobile joins forces with Orange

Deutsch Telekom and FranceTelecom have agreed to join forces in the UK and T-Mobile will join forces with Orange to create the largest (by users) network which will control 38% of the market.

Vodafone and O2 (Telefonica) both lost out with bids of around £3.5b. The new network (T-Morange, O-Mobile?) will be controlled by Orange and the brands will continue to be separate for 18 months, then everything will come under the new combined brand.

It can be assumed that Orange and T-Mobile will work to combine network assets which could cause problems for 3 who have a RAN sharing agreement with Orange.

The combined networks definitely have strength moving forward, but they'll have to maintain their lead and offer some innovative services so customers don't migrate away. Hopefully they'll combine the best aspects of both networks, rather than the worst or they'll just end-up another has been.

Vodafone and T-Mobile UK acquisition getting closer

Assuming there are no regulatory complaints, Vodafone may announce the acquisition of T-Mobile UK by next week. Deutsch Telecom may agree to the purchase if Vodafone swaps their Turkish network.

Ofcom recently released 3G coverage in the UK showing that O2 and Vodafone lagged behind 3, Orange and T-Mobile so a joint Vodafone/T-Mobile network would significantly increase their coverage and give them 40% of the UK market.

It is likely that other operators will shout unfair so the will be delays due to regulatory intervention.

Vodafone to buy T-Mobile?

Vodafone has 25% of the UK market, T-Mobile only has 15% but a combined company would have 40% of the market which is way ahead of O2 the current leader with 27%.

This would still require regulatory approval and the other networks would no doubt cry foul play, though Vodafone would be unlikely be considered a monopoly unless their market share rose considerably.

Though this could be seen as a bad thing for the market as competition would be reduced, it would give Vodafone economies of scale as they could improve coverage by merging physical networks and removing duplicate coverage while increasing coverage in areas that are poorly covered now. They could also increase capacity within the network allowing for high speed data services.

T-Mobile (Germany) may not wish to part with the UK arm at the moment as the valuation will be low in the current market conditions.

T-Mobile to launch HTC MyTouch

T-Mobile are going to launch their second Android phone the HTC MyTouch which to everyone else is the HTC Magic (as sold by Vodafone).

In the US it will cost $199 with a 2 year contract.

Not too exciting really.

Ofcom 2.6GHz spectrum Auction

Though T-Mobile has dropped their intention to take Ofcom to Judicial Review, O2 have now taken Ofcom to Judicial review and are attempting to include T-Mobile's intention even though T-Mobile pulled out. This will occur in April.

It has now also been ported that there is the potential for interference to radars operating in the 2.7GHz band which include airport radar. Therefore at least initially there will need to be coordination between 2.6GHz licensees and radar operators (such as the CAA and some ship types operated by the MoD and others).

At some point in the future the radar systems will be adjusted such that interference from 2.6GHz will be minimised.

Ofcom is still intending to launch the auction as soon as the judicial review has taken place (assuming it goes there way).