Ofcom proposes to liberalise the use of this spectrum, by removing the restriction to 2G. This will be required by a forthcoming European Commission decision which states that 2G spectrum should be freed up for a much wider range of uses, including high-speed mobile broadband services using 3G.

Two different bands are presently used for 2G: 900 MHz is used by Vodafone and O2 only; 1800 MHz is used by all four 2G operators. The consultation looks at how these spectrum bands could be used for 3G and other technologies, and the effect that changing the use of these key spectrum bands could have on competition and consumers.

Ofcom also proposes to remove technology-specific restrictions on the use of the 1800MHz band as soon as possible, and to make licences tradable, giving the current holders the option to transfer rights to use the spectrum to another party. These changes could take place in 2008.

Similar changes could also be applied to the spectrum band currently used for 3G services, at 2100MHz. Licences for this band are currently held by Vodafone, O2, T-Mobile, Orange and Hutchison 3G.