Government to auction broadband

Government coffers look set to burst with yet another auction

Hot on the heels of the auction for 3G mobile licenses the government announces Wednesday it will auction broadband fixed wireless access this autumn.

The mobile auction has surpassed all expectations -- at the last count accumulating nearly £20bn for government coffers. The government says it is keen to provide citizens with a variety of Internet access platforms and the next auction for broadband fixed wireless access (BFWA) will offer alternative delivery platform for broadband services.

Around 40 licenses will be available and they will be awarded on a regional basis. BFWA will offer fast Internet and multimedia services (including TV quality pictures) via radio links. Users will need a dish or aerial and a transmitter. Exact speeds are not available but according to a Department of Trade and Industry (DTI) spokesman they will be "very fast" -- equivalent to all other broadband delivery platforms.

Critics worry that the government's decision to use auctions for distributing spectrum is leading to grossly inflated prices leaving operators with no money to roll out the services. The government however, is confident the BFWA auctions will not mimic the 3G mobile auction. ""We don't expect it to generate such enormous bids," says a DTI spokesman.

The DTI stands by its auction system. "The government has been criticised in the past for not getting a good price for spectrum," claims the spokesman. "This way industry, not government, puts a value on licenses. It also creates the incentive to get on with it and roll services out," he says.

It is anticipated the auctions will mean cheaper broadband for consumers. "More competition often means cheaper prices," the spokesman says.

Interested parties are invited to comment on the proposals by May 19.

Over twenty billion pounds is currently on the table to buy the five third generation (3G) mobile phone Wireless Technology licences on offer from the British Government. Go to AnchorDesk UK with Tony Westbrook for the news comment.