After a lengthy delay caused by UK network Three challenging Ofcom’s 5G limitation, the auction for 4G and 5G spectrum finally went under way this week. Ofcom has since posted the results of the principle stage, with Vodafone and O2 taking away the biggest cuts.
Five major companies competed for 40MHz of the 2.3GHz band, currently used for 4G services and 150MHz of the brand new 3.4GHz spectrum which will be used for 5G. This was comprised of Vodafone, O2, EE, Three and Airspan Spectrum Holdings Limited. Hull-based fixed wireless ISP Connexin was also expected to take part but dropped out at the last minute.
Vodafone walked away with the biggest cut of the 3.4GHz band, spending just over £378 million on 50MHz. O2 was also a big spender, shedding nearly £318 million for 40MHz while also investing around £206m on all 40MHz of the 2.3GHz spectrum.
EE also took 40MHz of the 5G spectrum, spending a little less than competition at £303m. Despite its unsuccessful protests, Three managed to walk away with 20MHz of the 3.5GHz spectrum as the company gears up for 5G, which makes the company fare a little better than Airspan Spectrum Holdings Limited, which walked away with nothing from either band.
O2 is one of the biggest winners at this stage, as CCS Insight telecoms analyst Kester Mann notes that the network “needed the spectrum the most.” Vodafone’s investment has inevitably placed them at the forefront of 5G, “re-enforcing its renewed commitment to the market following several years in the doldrums.”
With the principle stage complete, Ofcom is now moving onto the assignment stage, which is the last in the bidding stages of the auction. During this period, the winners of the principle stage will bid to “determine where in the frequency bands their new spectrum will be located.”
While this is great news for any mobile internet enthusiast, the 5G auction brought in just £1.355 billion for the treasury, while 3G and 4G auctions brought in a whopping £22 billion and £2.2 billion respectively. Even though companies might lose their competitive edge by falling behind on the latest and fastest spectrum, many already have access to airwaves from previous auctions.
Either way, “This is good news for everyone who uses their mobile phone to access the internet,” according to Ofcom’s director Philip Marnick. As a nation we’re using ever more mobile data on smartphones and mobile devices. Releasing these airwaves will make it quicker and easier to get online on the move. It will also allow companies to prepare for 5G mobile, paving the way for a range of smart, connected devices.”
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KitGuru Says: In some instances, 4G is already better than some of the standard WiFi provided in the UK, making 5G all the more exciting. It’ll likely be a while before it is adopted fully into the market, but with the auction finally under way, operators can put the new band to good use as soon as possible. Are you looking forward to 5G connectivity?