Ofcom hints at 4G auction strategy
Published: 11 Aug 2006 11:50 BST
The next generation of mobile communications — currently ill-defined but generally referred to as 4G — will probably be kicked off with another round of spectrum auctions, Ofcom hinted on Thursday.
Speaking at the launch of the regulator's annual report into the communications market, chief operating officer Ed Richards said that Ofcom's "starting point is that we would release [spectrum for 4G services] using the market mechanism".
"Wherever we can we will do it on a liberalised basis," Richards added.
This strategy could be defined as allowing operators to bid for spectrum then "sort it out with end users by making offerings and seeing what works", Professor Martin Cave of Warwick Business School told ZDNet UK on Friday.
Cave was the author of a major study into spectrum review in 2002, and led an audit into public spectrum holdings for Ofcom at the end of last year. His audit recommended that providers of competing technologies should be encouraged to share bandwidth — something that has not happened with 3G.
"Ofcom has committed itself to releasing spectrum into the market via a competitive auction, but with no obligations on which way the spectrum would be used," he elaborated, before suggesting that spectrum trading, a policy authorised by Ofcom in 2004 but not yet implemented, might be the way forward.
"The name of the game has changed totally since the 3G auctions in 2000, as people have exit strategies and means of simply transferring spectrum to alternative users," Cave said. "It is an auction but the rules of engagement are so totally different you'd expect people to pay differently. If you thought the prices were too high you just wouldn't bid and would wait to pick up the spectrum later when people go bankrupt".
Responding to operators' fears over the possibility of spectrum being made available for non-3G technologies such as WiMax rather than being set aside as "3G extension" bands, he said: "It could be in their commercial interest to discourage new technologies unless they themselves are able to participate in them."
4G is likely to involve...
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