Ofcom fires starting gun on £5bn mobile airwaves sale

Ofcom has unveiled plans to increase mobile phone spectrum by 75% in an auction that could raise £5 billion.

The regulator wants to stage the auction by the end of the year, but some mobile phone networks are impatient that the Government has not moved faster. Networks are facing a surge in demand from users of smartphones and tablets, with mobile data consumption forecast to jump fivefold over the next five years.

Ofcom is offering extra spectrum, known as 4G, as the old analogue TV signal is switched off this year.

Ed Richards, Ofcom chief executive, wants 4G coverage to reach 98% of the UK population, and describes the auction as "the most significant spectrum release in the UK for many years".
The regulator, which believes that British consumers would be best served by four networks, revised its plans after carrying out an initial consultation last year.

Each mobile network faces limits on the amount of spectrum for which it can bid. James Barford of Enders Analysis said: "On a quick view
versus the previous consultation, Vodafone and 02 have done well, 3 has done less well and Everything Everywhere is mixed."

The mobile networks are keen to buy up 800 MHz former TV spectrum because it is high-quality.
There is also some less attractive 2.6 GHz spectrum available.

One licence for the new spectrum will require coverage of so-called "not spots" in rural areas, with £150 million of support from the Department of Culture.