UK telecoms regulator Ofcom can claim mission accomplished with last year’s 4G spectrum auction as far as maintaining competition, said the country’s National Audit Office (NAO).
But the spending watchdog said it was too early to say whether the winners have made efficient use of the radio frequencies they won.
The UK’s auction stands up to comparison with European peers in terms of the amount raised, said the NAO. “After adjusting for population sizes, proceeds were within the range achieved in other European auctions,” it concluded.
However, Ofcom’s tactic of reserving spectrum to foster competition did lower returns. The regulator’s own consultants – The Smith Institute – calculated that the proceeds were £159 million lower than they would have been had the spectrum won by Three – the UK’s smallest operator – not been reserved for it or a new entrant.
The larger picture of course is that Ofcom believes the presence of Three – as well as newcomer BT Niche – will foster greater long-term competition in the UK.
The 2013 auction raised £2.34 billion from the country’s four incumbents – EE, Vodafone, O2 and Three – as well as newcomer BT.
But it’s too early to say whether these winners are using their radio frequencies as efficiently as possible, said the NAO.
Since the auction took place Vodafone, O2 and Three have all launched 4G services (EE actually launched at the back end of 2012 using its existing spectrum) but it’s still early days with their respective services. New entrant BT has yet to launch 4G services.