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EE UK Starts Legal Challenge to Stop Cap on 3.4GHz 5G Mobile Spectrum

Tuesday, September 19th, 2017 (4:39 pm) - Score 1,054
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Mobile operator EE (BT) has formally lodged a legal appeal against the matter of Ofcom’s forthcoming 4G / 5G radio spectrum auction in the 2.3GHz and 3.4GHz bands. The aim is to stop Three UK’s own challenge from imposing a cap on their ability to bid for a slice of 3.4GHz band.

At present EE holds about 42% of all mobile spectrum, while Vodafone has 29%, O2 14% and Three UK 15%. Often the more spectrum you own, the better your services. Ofcom has agreed that the market needs a little correction and so their auction proposed to place a cap of 255MHz on the “immediately useable” spectrum (i.e. EE wouldn’t be able to bid on the 2.3GHz band).

On top of that the regulator also proposed a cap of 340MHz on the overall amount of mobile spectrum that a single operator can hold as a result of the auction (i.e. 37% of all the mobile spectrum expected to be useable in 2020, including the 700MHz band), which meant that EE would still be able to bid on a slice of the 3.4GHz band (they need this in order to prepare their own future 5G Mobile services).

However Three UK (CK Hutchison Holdings) has long campaigned for a punitive 30% cap and earlier this month they began a legal challenge of the auction in order to get it, which if successful would completely block EE from bidding. On top of that such a cap could also reduce the money earning potential of the auction itself, which would anger the Government.

Naturally EE were never going to take that lying down and so this week they too have carried out an earlier threat by formally lodging their own appeal against Three UK’s attempt to win a Judicial Review of the auction rules (credits The Register). As usual Ofcom’s canned statement is unchanged from the last time.

A Spokesperson for Ofcom said:

“It is very regrettable that the auction will now be delayed by this litigation, which will harm consumers, businesses and ultimately the UK economy. We hope this matter can be resolved promptly, so that we can release the spectrum as soon as possible.”

Meanwhile Three UK continues to deny that their litigation will harm Ofcom’s release of the aforementioned spectrum and they’ve optimistically predicted that their challenge will be a “short process,” which could be followed by a court decision in early 2018 (history shows that such cases can drag on for a long time, especially when more parties join the fun).

Rivals have frequently argued that Three UK’s parent company (CK Hutchison Holdings) has more than enough money to buy a good chunk of spectrum and indeed they’ve had plenty of opportunities to do so in the past, but haven’t.

Similarly critics point to Three UK’s recent purchase 5G friendly spectrum via their £250m acquisition of UK Broadband Ltd. (here), which they claim might give the operator a big incentive to delay the auction for as long as possible, although this is denied.

Funnily enough we are expecting to hear more about Three UK’s plans for UK Broadband’s spectrum and network before the end of 2017. Eyes will surely roll skyward if those plans involve some form of national 5G or similar network.

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Mark Jackson

By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he is also the founder of ISPreview since 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.

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9 Responses
  1. New_Londoner

    Perhaps Ofcom could restrict the ability of all mobile operators to deploy 5G services beyond a certain scale until outstanding litigation is resolved. This might encourage Three to rethink as it would lose a potential first mover advantage.

    • We won’t see that, after all they allowed EE to use 1800MHz for 4G and the operator befitted from a big head-start while the other bands were still being settled. If Ofcom were to change tact now and get into the practice of punishment measures then that might raise other concerns.

      More likely the regulator will find a way to split the 2.3GHz auction out or offer some sort of temporary licensing, until the 3.4GHz issue is resolved.

  2. Sam

    CK Hutchison Holdings has the money to outbid EE, if they want to compete then they need to actually buy spectrum instead of being given it or paying the absolute minimum.

  3. 3G Infinity (now 4G going on 5G)

    Qualcomm announced this week that the early availability of 5G devices, which will have support for 3.5GHz (3.4 – 3.6GHz), in 2019. So yes 3UK could start trials with devices and even the odd paying customer mid 2019 onwards.

  4. AndyC

    3uk where one of the big bidders in the 3g auctions and made a killing off it, if they dont want to spend money now then they need to shut up.

    EE have spent the money to support 4g, if they are willing to spend more on 5g why should they be held back? Sky have a domanance over uk sport and soon will be competeing directly with virgin and bt with their IPTV platform, they dont get held to account (not publicly anyway) or is this just because EE also has the letters BT attached to it now????

    Haveing used O2, voda, 3 and now virgin mobile (which uses EE 4g) i can tell you right now that the EE network is by far superior to the other 3 here where i live and when i go to 5g it will be with EE, well considering how long it took virgin to get 4g……

    • CarlT

      Three really didn’t make a killing out of the 3G spectrum. They and others overpaid massively.

      EE’s dominance comes in no small part as a result of merger of T-Mobile and Orange – they had 4G-ready spectrum good to go.

      Three tried to acquire O2 and were rejected. Had they been allowed to the spectrum market would’ve been more balanced.

      Sky are obliged to sell access to many of their TV channels, including some sports. I’m pretty sure EE aren’t required to sell access to their network at regulated rates so not comparable.

    • MikeW

      Agreed – Three didn’t make a killing out of their 3G spectrum. No-one did, except perhaps the government.

  5. MikeW

    How predictable was this?

  6. Craig

    I think its unfair that EE should dominate the market. Three need to be given more of a chance.

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