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UK 4G and 5G auctions raise more than £1.3bn

More than £1.3 billion has been raised from the latest '4G' and '5G' spectrum auctions in the UK, the country's telecoms regulator has announced.05 Apr 2018

The auctions were opened to bidding by Ofcom on 20 March. In the 5G auction, the regulator divided a total of 150 MHz of spectrum within the 3.4 GHz band into 'lots' which could be bid for, and made a further 40 MHz of spectrum available to bid for in the 4G auction within the 2.3 GHz band.

On Thursday, Ofcom announced that the "principal stage" of the auction had concluded and that four of the five companies that were eligible to bid in the auctions had successfully acquired a proportion of the spectrum being made available.

Vodafone won 50 MHz of spectrum in the 5G auction at a cost to the company of more than £378m, while EE and O2 both paid more than £300m for the right to use 40 MHz for future 5G services. Three won the remaining 20 MHz of spectrum that was auctioned off in the 3.4 GHz band, which it paid just over £150m for.

O2 paid more than £200m to acquire all of the 40 MHz of spectrum being made available for the provision of 4G services, Ofcom said.

Airspan Spectrum Holdings was unsuccessful in the auction, the regulator said. Airspan is leading a consortium in the UK government's 5G testbeds and trials programme focusing on connected and autonomous vehicles.

Ofcom said the EE, O2, Three and Vodafone will now compete to determine how the spectrum they have won is assigned in the "last bidding stage".

"This is a short process, which allows companies who have won spectrum in the principal stage to bid to determine where in the frequency bands their new spectrum will be located," Ofcom said.

"After the end of the assignment stage, we will issue the winning bidders with licences to use the relevant spectrum within a few days, allowing them to begin putting it to use. We expect to publish the final auction results shortly after," it said.

A previous 4G spectrum auction organised by Ofcom in 2013 raised £2.3bn. In 2000, the auctioning off of spectrum for the provision of 3G services raised more than £22bn for the Treasury, far in excess of the £5bn that was expected.