4G auction brings in smaller amount than expected, raising £2.3billion

The government hoped to receive around £1billion more from the Ofcom sale.

16:25 20 February 2013

Ofcom revealed on Wednesday morning that it has raised a total of £2.34billion at its auction where it sold 4G airwaves. This has left the UK government short, as reportedly the Treasury had hoped for the sale to be about £1billion more.

The result of Ofcom’s auction seems to have left the UK’s government disappointed as they had been expecting the regulator to secure a £3.5billion deal. It is understood that some thought the sale would not bring in £3.5billion, while others predicted before the auction that the figure would be higher.

 

Those to have benefitted from the sale include; Everything Everywhere (EE), Hutchison 3G UK, Niche Spectrum Ventures, Telefonica UK, and Vodafone, who all won parts of the 4G spectrum.

 

Although the auction gave the government a smaller amount than they had hoped for, it reflected how tough the competition is for 4G. At the moment the company EE are the only 4G provider in the UK.

 

Ofcom Chief Executive Ed Richards commented on the situation. “This is a positive outcome for competition in the UK,” he said.

 

“We are confident that the UK will be among the most competitive markets in the world for 4G services."

 

Mr. Richards added: “4G coverage will extend far beyond that of existing 3G services, covering 98% of the UK population indoors – and even more when outdoors – which is good news for parts of the country currently underserved by mobile broadband.”

 

The Ofcom Chief explained that the outcome of the 4G auction could mean there are good things ahead for Britain. In the future the UK could have more access to mobile broadband, which is faster, and this would be good news not only for the consumer market, but also for businesses.

 

There are hopes for 4G products to be made available to most of the UK within the next 5 years.