Operators deny making litigation threats over 4G auction delay

There’s a lot of demand for data lately and not enough spectrum for some networks to run on to keep up. That was one of the reasons why Ofcom was going to hold a 4G spectrum auction, supposedly early next year. However, the auction has been postponed once again and this time, indefinitely. This was to the chagrin of many networks which did not have additional spectrum to fall back on compared to the larger firms, like Three UK.

Three had earlier revealed that they would soon be running out of capacity if the auction fell through, with its chief executive, David Dyson, stating: “There is a huge financial incentive for rival operators to delay the auction. We are worried that the other three will attempt to squeeze us out of the market.”

Ofcom stated that the postponement was so that they could conduct a second round of consultations. The regulator has also had to take a lot of criticism for their decision, but Ofcom’s director of the spectrum policy group, Hyacinth Nwana, has since defended the move: “We make no apologies for going back to reconsult. We received very difficult and challenging responses to the first consultation, so we need to answer those and it won’t constrain the timetable for releasing the spectrum because of the clearance activities. Clearing the spectrum is only happening in a piecemeal fashion across the UK, and will only be cleared by 2013. We are comfortable with the [auction] timescales we have set out.”

Just last Tuesday, Ofcom’s chief Ed Richards had accused the operators of making legal threats because of the auction delay. He stated that “incumbent mobile operators have chosen to entangle this process in litigation or threats of litigation.” He added that the threats were strategic and exhibited a “willingness to game the system.”

However, Everything Everywhere has spoken up and denied the allegations, saying that they only sent in recommendations on how the auction should be run: “We believe that the 4G auctions should be held as soon as possible so the benefits of faster data speeds reach consumers quickly. We understand though from Ofcom that the complexity of the issues means that further consultation is necessary. We stand by our recommendation that to ensure fairness, the auction is designed so that all operators — not just Vodafone and O2 — get access to sufficient low frequency spectrum. The sooner this is resolved, the better for all of our customers.”

Vodafone also spoke up, saying that although they weren’t keen on the auction delay, they were also not keen on litigation. “There is much to commend in Ofcom’s initial proposals for the auction of new spectrum next year, but there is still work to be done to ensure the auction is a success We think there should be a level playing field between operators and a fair auction that provides UK consumers with the most competitive market for 4G services.”

Vodafone added: “Unlike some of our rivals, Vodafone is not a serial litigator. In the last eight years, we have only appealed two Ofcom decisions and we have actually supported Ofcom in the courts on ten separate occasions.” The firm also said that it has “no desire to become involved in litigation and there shouldn’t be any need for litigation if the hard work is done now to get the rules right.”

Source – ZDNet