Ofcom cracks on with spectrum auction rules, despite Three's legal challenge

UK telcos continue appeal to lower spectrum cap

UK comms regulator Ofcom is cracking ahead with plans for the forthcoming spectrum auction – despite further delays posed by Three's Court of Appeal challenge.

The regulator had planned to hold the auction for the 2.3 and 3.4 GHz bands in autumn 2017, but it has been delayed by litigation brought by Three UK and BT/EE – the former wanting lower caps to spectrum ownership, and the latter wanting the cap removed entirely for the 3.4GHz band. Those bands will be crucial to extending 4G coverage, as well as laying the foundation of 5G.

Last month the High Court upheld Ofcom’s decision and dismissed both claims. Three has appealed that decision, which will be heard on 13 and 14 February 2018 at the Court of Appeal.

"The litigation by Three is continuing to delay access to the spectrum and the benefits to consumers and businesses that can flow from it. We are keen to ensure that we are in a position to move as quickly as possible to hold the auction, once the judgment of the Court of Appeal has been given," said Ofcom.

"We have therefore decided to proceed to make the auction Regulations, which we intend to do on Wednesday 24 January 2018."

Ofcom said if it has to change any of the regulations in light of the Court of Appeal’s judgment "we will do so with utmost expedition to minimise further delay".

Matthew Howett, founder of analyst firm Assembly, noted that Ofcom intends to do everything but qualify bidders. "A lot of what they intend to publish will just be admin for the auction. But the general tone of frustration is coming through, especially with Three," he said.

"There aren't many people who think Three will win the appeal, but it is a company that has a tradition of sticking to its principles and campaigning hard. It has beef with Ofcom over [its advice regarding] the decision to block its [£10.5bn] merger with O2."

He noted Three had also sank a lot of money into its "make the air fair" campaign, which called for a 30 per cent cap on the amount of spectrum a British company could own.

Instead the regulator capped the maximum amount of mobile spectrum a British company could own at 37 per cent as part of its spectrum terms - triggering Three's judicial review.

Currently, BT/EE currently holds 42 per cent of immediately usable UK mobile spectrum, with Three owning 15 per cent, Vodafone 29 per cent, and O2 14 per cent.

Three's basis for the challenge was prompted by concerns that the 37 per cent cap on spectrum is not guaranteed.

The Register has asked Three for a comment. ®