National Audit Office Probes the UK 4G Mobile Spectrum Auction

Everything Goes

15-04-2013

Quote:
“The National Audit Office (NAO), which is responsible for scrutinising public spending on behalf of Parliament, has confirmed that it will investigate whether or not Ofcom’s underperforming auction of the 4G (LTE) based 800MHz and 2.6GHz mobile broadband spectrum has delivered “value-for-money“.

The government originally estimated that the auction would rake in around £3.5 billion and Ofcom revealed last month that Mobile Networks Operators (MNO) had made total “theoretical” bids of roughly £5.2 billion (here). But despite this the final tally came in at a decidedly lower than expected £2.368bn.

Apparently the reason for this is because Ofcom had adopted a more secure auction strategy, which employed a second bidder rule. In other words the winning operator only had to pay slightly more than the next highest bidder in order to obtain their slice of the spectrum. On top of that Three UK only needed to pay the reserve price for its slice of the 800MHz band.”

http://www.ispreview.co.uk/index.php...m-auction.html

DevonBloke

16-04-2013

I think is good they didn't pay so much. More money for rollout.

"In fairness many tend to regard the original 3G auction in 2000, which raked in an earth shattering £22bn, as having been wildly overpriced and one of the key reasons why operators initially struggled to invest in 3G. Indeed the market for 3G services only really came to life between 2007 and 2008 when a combination of affordable Mobile Broadband deals and new Smartphones (e.g. iPhone3G) began to enter the market.

The flip side of this coin is that mobile operators will now have more money to hopefully re-invest in their networks and services, which should in theory lead to a more affordable market for consumer services and one that could in turn boost the country’s revenue from ecommerce (online sales, shopping etc.). In many ways it’s a miracle that the auction even happened at all, especially with the mass of legal squabbles that have held the effort up for the best part of 4-5 years."

Everything Goes

16-04-2013

Originally Posted by DevonBloke:
“I think is good they didn't pay so much. More money for rollout.

"In fairness many tend to regard the original 3G auction in 2000, which raked in an earth shattering £22bn, as having been wildly overpriced and one of the key reasons why operators initially struggled to invest in 3G. Indeed the market for 3G services only really came to life between 2007 and 2008 when a combination of affordable Mobile Broadband deals and new Smartphones (e.g. iPhone3G) began to enter the market.

The flip side of this coin is that mobile operators will now have more money to hopefully re-invest in their networks and services, which should in theory lead to a more affordable market for consumer services and one that could in turn boost the country’s revenue from ecommerce (online sales, shopping etc.). In many ways it’s a miracle that the auction even happened at all, especially with the mass of legal squabblesare that have held the effort up for the best part of 4-5 years."”

I guess Osborne and Cameron were embarrassed about their estimates being short!

The networks paid way too much the last time. Even today some networks are still struggling to invest in their 3G networks.......

Everything Goes

16-04-2013

Quote:
“The NAO's move was prompted by a complaint by Labour MP Helen Goodman.

She was concerned by remarks made by Ed Richards, the chief executive of regulator Ofcom, which arranged the auction, to the effect that raising money was not the prime purpose of the sale.

Mr Richards told the BBC at the time that the figure was lower because "we are in very, very different times", adding that maximising the size of the auction was not the objective it was set by the government.

He added: "What we were trying to do was ensure that a valuable economic resource was brought into productive commercial use."”

http://www.bbc.co.uk/news/business-22165797

Everything Goes

04-07-2013

The NAO has given the 4G auction the thumbs up

Quote:
““Ofcom was not set an objective by government to maximise the value of auction proceeds, and made no forecast of anticipated proceeds in advance of the auction, although it did state that the reserve price for the spectrum to be auctioned was £1,360 million. Ofcom was, however, tasked with delivering an auction outcome that would maximise the benefits to be delivered for consumers, and estimates that £20 billion of consumer benefits will be delivered through the competitive 4G market.

The auction met its planned objectives, and the overall project timetable set out in paragraph 5 of my report.””

http://www.ispreview.co.uk/index.php...-spectrum.html