Mobile Operators Face Huge Fines if they Fail UK Coverage Target

The Government’s Culture Secretary, Nicky Morgan MP, has revealed that Mobile Network Operators (Three UK, Vodafone, O2 and EE / BT) could face huge fines – worth up to 10% of their annual turnover – if they fail to meet their new 4G / 5G geographic UK coverage obligations by 2026.

Last week the Government announced a new £1bn industry led Shared Rural Network (SRN), which replaces the old regulated proposal (i.e. attaching a coverage obligation to the auction of the 700MHz band) with an industry-led sharing of existing masts and new masts in poorly served areas; Ofcom adapted to this change yesterday (here).

Assuming all goes to plan then the SRN should result in each individual operator reaching 92% geographic coverage by 2025, with licence obligations taking effect in 2026. The collective effect of this will deliver coverage to 95% of the UK.

At the time the Government said that mobile operators had agreed to adopt new, “legally-binding licence conditions“, although until now it was unclear precisely what those conditions would impose for operators that fail to meet the coverage targets.

Nicky Morgan MP said:

“The announcement is great news for consumers and a big step forward by the mobile network operators. It will be underpinned by legally binding commitments from each operator to reach more than 92% UK coverage by 2026. The mobile network operators will adopt new coverage obligations within their existing spectrum licence conditions to ensure that the outcomes will be delivered.

If they cannot demonstrate that all reasonable efforts have been made to comply with the obligations, there are penalties for the operators, with a maximum fine of up to 10% of annual turnover. Although 2025 is the target date, many consumers will feel the benefit of the programme long before its conclusion.

Annual coverage improvement targets will be published, and Ofcom will report regularly on the shared rural network’s progress in its “Connected Nations” publication.”

The reference to “all reasonable efforts” does however create a potential get-out clause, not least since it’s possible that objections by local campaigners / councillors to new masts or unavoidable problems with wayleaves may yet get in the way of progress. Much of this may thus end up depending upon the Government’s current consultation on mobile related planning reform (here).