Mobile working Toolkit

Ofcom hints at 4G auction strategy

Tags:
Spectrum,
Professor Martin Cave,
Mobile TV,
DVB-H

David Meyer ZDNet.co.uk

Published: 11 Aug 2006 11:50 BST

... an evolution of the 3G standard, which has already morphed into high-speed downlink packet access (HSDPA) and will soon incorporate the uplink version of that technology, HSUPA. However, it could also include WiMax (which has just been given a huge boost by US carrier Sprint's backing), possibly as network back-haul to whatever evolves out of 3G.

Whatever shape 4G takes, all operators are keen to avoid the debacle that followed the 3G auctions in 2000. £22.5bn was spent on acquiring spectrum — and the costly obligation to roll out networks across the UK by the end of 2007 — but operators have seen very little return.

As statistics in Ofcom's report show, take-up of 3G services has been low. This confounded the assumption that 3G technology was immediately ready for the market — in reality, the initial devices were clunky and business cases were underformed. Richards described this assumption on Thursday as "always unwise".

None of the four major UK networks has even a million 3G subscribers. The only major growth story is Hutchison's 3 network, which exclusively sells 3G phones. Even there, 3G data revenue is mainly derived from SMS. People continue to use their phones primarily to make voice calls.

"It's tempting to say we'd like 3G to be further forward," said Richards, "but it's not our role". Nonetheless, he pointed out that operators continue to "experiment and innovate to see what works".

Richards also responded to operator O2's calls for spectrum to be made available for DVB-H, a type of broadcast mobile TV that promises more channels than the imminent DAB-IP systems being touted by BT and Virgin.

"Spectrum is not infinite. It's a scarce resource and in this day and age everybody wants it," Richards said, adding that finding a "sensible and efficient way of allocating it" was going to prove a key challenge in the next two to three years.

He also suggested that "public value" was a key factor in deciding who would receive such spectrum.

Cellular spectrum comprises only 5 percent of total UK spectrum, according to Ofcom's report. The Ministry of Defence has the largest share with 30 percent, despite releasing parts of its allocation to commercial interests over the last decade.