Ofcom Call On UK Government To Make 2G Spectrum Available For 3G Mobile Broadband

Ofcom Call For 2G Spectrum For 3G Mobile Broadband

UK communications regulator Ofcom has informed the government that it should make the 2G radio spectrum (voice communication for mobile phones) available for 3G mobile broadband services as soon as possible.

Ofcom came to the conclusion of opening up the 2G spectrum after publishing a paper concerning its analysis of the possible consumer and competition issues that could arise from opening up the existing 900MHz and 1800MHz radio spectrum for the use of 3G services.

Through its research the industry regulator found that freeing up the 900MHz and 1800MHz spectrum is in the hands of the existing licensees (O2 and Vodafone UK), and is possible without imposing conditions (beyond that of essential technical requirements).

This move to open up the 2G spectrum would also likely benefit consumers and is unlikely to result in a material distortion of competition which would have required further action to be taken. In particular it would make reaching rural areas with Mobile Broadband services much more viable.

The 900MHz and 1800MHz spectrum liberalisation benefits:

• Greater network capacity allowing more customers to be served and to enjoy higher mobile broadband speeds (both 900MHz and 1800MHz spectrum);
• Improved quality of coverage allowing customers to use mobile broadband in more locations with greater consistency (900MHz spectrum);
• Improved in-building coverage (900MHz spectrum).
• Wider coverage of rural areas (900MHz spectrum).

The key area would be the 900MHz spectrum which is currently well deployed in the UK and would provide consumers with an instant benefit to their services.

On the other hand Ofcom described the 1800MHz spectrum as being less well developed in terms of both likely speed of availability of equipment and services. The only barrier to effective use of both bands for Mobile Broadband is regulation.

Once possible sticking point however, is that currently the owners of 900Mhz (O2 and Vodafone UK) have not been very keen on the idea of sharing access to the band with their rival networks (namely Three, Orange and T-Mobile), but Ofcom consider this not to be a problem.

Ofcom Statement

Since our consultation, demand for mobile broadband services in general, and for use of the 900MHz band to deliver 3G services more specifically, has become clearer. However, our view of the likelihood and size of a competitive distortion arising has, significantly, reduced.

This is largely because of the merger between Orange and T-Mobile creating Everything Everywhere (EE). Of the operators today, EE, and to a lesser extent H3G through its network sharing arrangement with EE, are in the strongest position in terms of network capability for providing UMTS services.

They have the largest amount of 2100 MHz spectrum and access to the largest number of base station sites. Accordingly, we believe these operators would be able to improve their coverage (if required) and consequently reduce any competitive advantage that O2 or Vodafone might realise from using 900MHz spectrum for the provision of 3G services, albeit at potentially greater cost.

This will likely be good news for rural areas of the UK and the government itself, which won’t have to spend as much time negotiating with O2 and Vodafone to share their 900MHz spectrum.

However it’s also possible that Vodafone, T-Mobile and 3 might have a problem with this outcome, though it would be difficult for them to fight it.

The government had planned to get issue resolved by the end of 2011, although Ofcom has now cleared the path for a quicker resolution time-frame.