More 3G auctions planned

Ofcom reveals plans to sell radio spectrum for new 3G and WiMax services

The 3G market is set to be opened up to more competition by telecoms regulator Ofcom.

Ofcom said on Monday that it will auction a large chunk of radio spectrum that would allow network operators to build 3G and WiMax networks.

The move comes six years after five mobile network operators — O2, Orange, 3, T-Mobile and Vodafone — collectively paid £22.5bn for licences to operate 3G services in the UK. The upcoming radio spectrum is likely to be available for a fraction of that price. It covers a range of frequencies: approximately 2GHz; approximately 2.3GHz; and between 2.5-2.69GHz. Current 3G services work at about 2GHz.

Ofcom says it will not concern itself with the type of technology used, adding that interest is likely to be highest in providing either UMTS (a flavour of 3G) or mobile broadband, such as WiMax. Asked by ZDNet UK whether 3G services will be allowed, an Ofcom spokesman said: "Yes. Our whole approach to spectrum management is that the market is better placed to decide how to use spectrum than the regulatorm," adding a caveat that the technology must not cause harmful interference.

Telecoms regulation in the UK has changed substantially in the last six years. While Oftel, Ofcom's predecessor, mandated the services that could be used in a given piece of spectrum, today's regulators favour a technology-agnostic approach.

Perhaps surprisingly, Vodafone said on Monday afternoon that it welcomed Ofcom's proposal. When contacted by ZDNet UK, a Vodafone spokesman said: "The telecoms world is becoming much more competitive. There are more operators moving into this space, and more competition is good news for customers."

Two other mobile operators contacted by ZDNet UK — O2 and T-Mobile — offered no comment on Ofcom's proposals at the time of writing.

BT, which is evaluating the potential of mobile WiMax, took an optimistic approach to Ofcom's plans. Steve Andrews, chief of mobility and convergence, said: "We are naturally interested in the potential of this spectrum, and we continue to assess its possible uses, including the possibility of WiMax." However, Andrews added that mobile WiMax needed several more years to mature before BT would deploy it.

It is understood that BT is interested in evaluating the spectrum purely for WiMax purposes, and that the telco was not interested in building out its own 3G network.

Ofcom will seek views on its proposals over the next 12 weeks. The auction could take place as soon as late 2007.