4G in the UK: MoD to put airwaves up for sale

The Ministry of Defence is planning to sell off 200MHz of spectrum in order to make way for the growing demand for capacity from mobile operators, in a move that could bag the government up to £1bn.
Written by Ben Woods, Contributor

The UK Ministry of Defence (MoD) will auction off 200MHz of spectrum in 2014 — spectrum that mobile operators will be able to use for 4G or fixed-line services later that year.

The MoD is selling off the spectrum in response to demands for extra capacity from operators, it said on Monday.

"The sale will give private operators the chance to buy more spectrum to support the introduction of fourth-generation mobile services to people in cities, towns and villages across the UK. Alternatively the spectrum could be used by fixed-line operators to provide wireless access to broadband services," the MoD said in a statement.

Unlike the spectrum that will be auctioned for 4G LTE services at the beginning of 2013 (which is in the 800MHz and 2.6GHz bands), or EE's nationwide 4G service, which uses the 1800MHz band, the MoD's reserves are in the 2.3-2.4GHz band and 3.4-3.6GHz bands.

While the Financial Times reported on Sunday that spectrum analysts are predicting the sale could raise between £400m and £1bn for the government, the value of the spectrum is likely to be far lower than the prized sub-1GHz spectrum due to go on sale at the start of 2013. Ofcom's estimate for the 800MHz and 2.6GHz auction is around £1.3bn, while chancellor George Osborne said it could net the government up to £3.5bn — a figure that some analysts say is optimistic.

Preparations for the MoD's auction will begin at the end of next year, with the process expected to be complete by the end of summer 2014.

The sale follows an announcement in the government's 2010 spending review that at least 500MHz of spectrum below 5GHz should be released for new mobile uses before 2020.

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