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UPD3 Ofcom Shuns Concern to Let Orange UK and T-Mobile Launch 4G in 2012

Tuesday, August 21st, 2012 (8:51 am) - Score 657

The communications regulator, Ofcom, has today ignored threats of legal action from rival mobile operators by allowing T-Mobile and Orange UK (Everything Everywhere) to deploy superfast “4G” Mobile Broadband services over their existing 1800MHz radio spectrum.

Ofcom, which is under an EU Directive to ensure that the 1800MHz band can be used for 4G services, “provisionally” proposed to make the change in March 2012 (here) but was later forced to delay the move (here) after rivals O2, Vodafone and Three UK criticised the regulator for allowing EE to get a head-start on 4G. Rival operators will have to wait until late 2013 or early 2014 before they can launch 4G over the soon-to-be-auctioned 800MHz and 2.6GHz bands.

Ofcoms Statement on Today’s Decision

Although we consider it likely that EE will enjoy a competitive advantage during the period before other operators are able to launch their own LTE services, we consider on the evidence available that any such advantage is unlikely to result in an enduring advantage which distorts competition to the detriment of consumers.

Our assessment takes account of the impending release of additional spectrum in the 800 MHz and 2.6 GHz bands which will enable other operators to launch competing LTE services during the course of 2013. We have also taken into account EE’s obligation to divest itself of some its 1800 MHz spectrum.

In light of this assessment, and for the reasons explained in more detail in this decision, we consider that it is in the interests of consumers for us to vary EE’s licences now, in accordance with EE’s request.

As a result Ofcom has now issued EE with varied 1800MHz licences that will allow the operator to use either LTE and or WiMAX on the related spectrum from 11th September 2012. EE has of course made no secret of its desire to launch the first truly national 4G services before the end of this year; 1800MHz has a shorter range and thus usually works best in urban areas.

All eyes will now be on Three UK, which has repeatedly said that it’s desperate for new spectrum and hinted that it could take legal action unless the regulator addresses its competition concerns. Ofcom is also under similar pressure from O2 UK and Vodafone, which don’t want Three UK (the markets smallest operator) to be gifted a slice of the forthcoming 800MHz spectrum as currently proposed.

Meanwhile Ofcom has already allowed O2 to re-purpose its existing 900MHz spectrum for use by 3G services (legally O2 could use 900MHz for 4G too but they don’t have quite enough of the spectrum to make that work), which Three UK believes has given some rival operators an incentive to “defer that auction for as long as possible“. Expect more bickering to follow today’s announcement.

UPDATE 11:01am

As expected EE has told the BBC that Ofcom’s decision is “great news for the UK“, while O2 said that it was “hugely disappointed with today’s announcement, which will mean the majority of customers will be excluded from the first wave of digital services“. Likewise Vodafone felt that Ofcom had, “shown a careless disregard for the best interests of consumers, businesses and the wider economy through its refusal to properly regard the competitive distortion created” by allowing one operator to run 4G before the others.

UPDATE 22nd August 2012

In a new twist, albeit not an especially surprising one, EE has agreed to sell a slice of its 4G compatible 1800MHz spectrum to Three UK (here). But they won’t be able to use it for a year.

UPDATE 23rd August 2012

Just to 100% clarify some of the other reports going around. EE plan to launch a third new brand that “will sit alongside Orange and T-Mobile“. In a statement we were told, “Orange and T-Mobile will remain in the UK market for the foreseeable future and Everything Everywhere will continue to the company name and will be the company that runs all three brands.”

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Mark Jackson
By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
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9 Responses
  1. Avatar DanielM says:

    I wonder how much EE spent on lobbying lol

  2. Avatar No Rest says:

    Vodafone isnt at all happy!

    “The regulator has shown a careless disregard for the best interests of consumers, businesses and the wider economy through its refusal to properly regard the competitive distortion created by allowing one operator to run services before the ground has been laid for a fully competitive 4G market,” a company spokesperson said.

    http://www.bbc.co.uk/news/business-19328653

  3. Avatar DTMark says:

    I obviously don’t know enough about how this works… Why are certain spectrums being permitted for differing companies?

    Because all this will lead to is “hoarding” of those frequency ranges. Which doesn’t do anyone any good. If a new company wants to supply a 4G service here over certain frequency ranges which are presently unused in the area, why should they be prevented from doing so because another operator holds a “licence” to do so if they chose to?

    Rather, why not licence on a site to site basis, with a first-come-first-served approach incentivisng rapid rollout… what have I missed here?

    1. Mark Jackson Mark Jackson says:

      As ever there’s a complicated history of spectrum ownership and commercial models to consider, which can’t simply be reversed as operators have spent billions developing related networks and services around it.

      In fairness Ofcom and the EU have been trying to improve the allocation of spectrum without damaging the market, although established operators naturally don’t like to see that happen.

    2. Avatar DTMark says:

      Do I have this right then…

      Government wants to find new ways to endlessly extract money from citizens to buy votes.

      Direct taxation unpopular as ever. So tax private companies for ‘licences’ which then gets cash upfront to spend on wasteful pet projects and social engineering of the chosen social class of said government.

      The cost still trickles down to the taxpayer anyway in the form of increased charges for usage.

      In the meantime, ensure that one commercial operator has a massive head-start and monopoly over certain key components in return for said cash up front.

      And then set up/maintain a quango which presides over the farce that is faux-competition to justify itself.

      I’m sure I’ve seen that model somewhere before.

  4. Avatar DanielM says:

    Whats the point in 4G if i can get speeds like this http://i45.tinypic.com/hwllhh.jpg

    People ignore the fact that 4G won’t get 100Mbps or even near that if the tower isnt Fibre/Gigabit.

    1. Mark Jackson Mark Jackson says:

      4G itself is about more than merely improving raw connectivity speed but I do agree. The real prize isn’t so much 4G as the related release of 800MHz spectrum in the near future and better overall mobile broadband coverage.

    2. Avatar DTMark says:

      You get that with 3G?

      I thought we were doing pretty well…

      http://speedtest.net/result/2130964855.png

      But we’re not in a congested area as I suspect many town folk are; I thought the average MBB speed was only about 2Meg.

      I’d have thought that within a fairly short period of time, it would be possible to buy a small box you put on the window sill which generates a Wi-Fi network (like the Mi-Fi thing) and into which you can also plug a PSTN phone or use DECT phones.

      So if you want superfast broadband and you can get that from BT’s fibre cabs (assuming your cab has it and you’re near enough to it) or you can get cable then you can go that route.

      Otherwise, the above setup – given the extra bandwidth available – should compare perfectly well with a standard PSTN line and ADSL broadband rendering them both obsolete.

    3. Avatar DanielM says:

      “I thought the average MBB speed was only about 2Meg.”

      Maybe 2 years ago… The reason why people get crap speeds these days is simply because of there hardware. As me and you have proven its possible to get near 4g real life speeds (10-25Mbps) with hspa+

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