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Telecoms: Seven bidders in pounds 3.5bn auction of 4G spectrum
[December 20, 2012]

Telecoms: Seven bidders in pounds 3.5bn auction of 4G spectrum

(Guardian (UK) Via Acquire Media NewsEdge) Seven bidders will vie for the biggest chunk of mobile data bandwidth to be auctioned in Britain in January when Ofcom sells off 4G spectrum, expected to raise pounds 3.5bn for the government.

The bidders are Everything Everywhere - the combined T-Mobile and Orange operation, which is already offering 4G services - Vodafone, O2 and Three, as well BT, the Hong Kong conglomerate PCCW (which owns Hong Kong Telecom), and the British network company MLL Telecom. At least one will be obliged by Ofcom to serve 98% of the UK population. Ofcom has placed a reserve price of pounds 1.3bn on the 4G sale, but the government's tax and spending watchdog, the Office for Budget Responsibility, has estimated a pounds 3.5bn boost to public finances.

It is not expected to bring in anything like the pounds 22.5bn collected by the 3G bandwidth auction in 2000, when the present four networks were successful.

Mobile operators in the Netherlands last week paid euros 3.8bn (pounds 3.1bn) for the country's 4G spectrum, easily surpassing expectations of about euros 450m. In Ireland last month, operators overcame a challenging economy to generate euros 854m.

The four UK network operators are already preparing their networks to add 4G capability, which they hope to begin offering by next summer.

The consultancy Strategy Analytics forecast this week that 275m 4G-capable smartphones will be shipped worldwide next year, more than triple the 91m in 2012. Charles Arthur (c) 2012 Guardian Newspapers Limited.

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