Government intervention results in 4G peace talks

Senior government officials have intervened in the ongoing dispute over 4G spectrum, which has resulted in the UK’s four mobile operators agreeing to a one month hiatus on any legal action in order to carry out peace talks.

Analysts have called for government interventionin recent months, as it was becoming increasingly likely that the spectrum auction, which was due to take place earlier this year but has been delayed numerous times due to industry disputes, would be further postponed.

In one of his final acts as culture secretary, before being replaced by Maria Miller in last week’s reshuffle, Jeremy Hunt called in the chief executives of Everything Everywhere, Vodafone, O2 and Three to help smooth rollout plans, according to the Financial Times.

“The industry [would have got] to a point of mutual destruction if people started suing,” said one person familiar with the talks.
“This is a cooling-off period where no one can launch or litigate and where the industry can work out a collective way forward.”

Miller has been brought up to speed with the situation and will participate in the talks going forward.

Initial proposals laid out by Ofcomhave been altered through a series of consultations, but the main area of concern from industry players is the regulator’s plans to allocate a minimum amount of spectrum to the UK’s smallest player Three, in a bid to ensure effective competition in the market.

Further frustrationwas caused last month when Everything Everywhere (EE) was given the green light by the communications regulator to roll out 4G networks ahead of its rivals through the use of its existing 1800Mhz spectrum, which it currently uses for 2G services.

It was revealed todaythat EE has switched on its 4G network in four UK cities, so that the company’s engineers can begin live testing and systems integration in preparation for a commercial rollout, but customers of the existing Orange and T-Mobile brands will not have access to the new 4G services.

The LTE network will become available to consumers and businesses in London, Bristol, Cardiff and Birmingham in the coming weeks, and is expected to launch in 12 more cities – Edinburgh, Belfast, Derby, Glasgow, Hull, Leeds, Liverpool, Manchester, Newcastle, Nottingham, Sheffield and Southampton – by Christmas.

Further towns, cities and rural areas will follow rapidly, with 2013 population coverage to reach 70 percent, and 98 percent covered by 2014.

Vodafone launched a particularly scathing attack on Ofcom when it was revealed that EE would be allowed to rollout 4G ahead of its rivals, claiming that the regulator itself that is standing in the way of getting 4G services to the UK.

It also said that the decision is "bizarre", given that Everything Everywhere is reportedly very close to sealing a deal with Three to sell it some of its old 2G spectrum, which was part of the agreement when T-Mobile and Orange merged to become EE.

The 4G auction will offer spectrum in at least two frequency bands – 800MHz and 2.6GHz. The 800MHz band is part of the ‘digital dividend’, and is ideal for providing mobile coverage over wide areas, while the 2.6GHz band offers high capacity.

Copyright © 2012 IDG Communications, Inc.

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