Ministry of Defence to auction off surplus 4G spectrum

The Ministry of Defence (MoD) is to sell off spectrum previously reserved for military applications, as the government looks to increase 4G spectrum sales.

The sale is the first of its kind by a government department, and will give mobile operators access to an additional 200 MHz of radio spectrum, easing expected demands on 4G services. An auction will take place during the summer of 2014, with preparations starting towards the end of 2013 for the spectrum sale. 

The spectrum being sold by the MoD is below the 15 GHz range, considered the most valuable part of the spectrum, and is used in services such as defence, transport and emergency services.  

The MoD currently owns around three quarters of all publicly owned spectrum, and a third of spectrum under 15 GHz.  The department has ongoing plans to free up certain ranges from military usage, with a government plan to give wider access to 500Mhz of spectrum under the 5GHz range by 2020.

The MoD has previously handed spectrum to Ofcom to deal with increased demands during the Olympics earlier this year.

The MoD says that the sale of spectrum is aimed at providing more bandwidth to 4G users, as demand from connected smartphones and tablets increases. This will allow more customers 4G access, and provide better services, and is also likely to raise extra cash for the government.

Minister for Defence Equipment, Support and Technology, Philip Dunne, commented: “We welcome this opportunity to free up much-needed spectrum. We hope that the sale will help drive the roll-out of new generation networks and universal access to broadband, both of which are vital to the UK’s prosperity.”

An MoD spokesperson was unable to provide comment on the reserve price, and to what extent the auction will be handled by the department or through Ofcom.  These details will be provided during an Industry Day in spring 2013, ComputerWorld UK was told.

The spokesperson confirmed that the money generated as a result of the auction will be allocated directly to the Treasury.

Although the department has not indicated how much is expected to raised by the auction, though analysts cited by the Financial Times claim that it could be up to £1 billion.

The money raised by the sale of MoD will be in addition to revenues generated as a result of the ongoing auction of 4G spectrum through communications watchdog Ofcom.

The auction process has now begun for all operators following the launch of services through EverythingEverywhere, which recently extended the reach of its own services to additional cities across the UK.

The sale of 4G spectrum is expected to raise billions of pounds for the government. Ofcom set a reserve bidding price of £1.3 billion, though it is expected that the final amount would be higher than this.  Chancellor George Osborne accounted for the sale of the 4G spectrum reaching a total of £3.5 billion in his recent budget statement.

Copyright © 2012 IDG Communications, Inc.

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