[kictanet] Digital Dividends and why we must plan NOW.

[bitange at jambo.co.ke]

Why we must make some sacrifices now to ensure better planning for
broadband planning for the next few years.  The UK case below.

Ndemo.



The UK regulator OFCOM has just announced the winners of the recent 4G
auction that started in November 2012,

The results and spectrum allocations are summarized in the press release
below:

Ofcom has today announced the winners of the 4G mobile spectrum auction.
After more than 50 rounds of bidding, Everything Everywhere Ltd, Hutchison
3G UK Ltd, Niche Spectrum Ventures Ltd (a subsidiary of BT Group plc),
Telefónica UK Ltd and Vodafone Ltd have all won spectrum. This is suitable
for rolling out new superfast mobile broadband services to consumers and
to small and large businesses across the UK1. The auction has achieved
Ofcom’s purpose of promoting strong competition in the 4G mobile market.
This is expected to lead to faster mobile broadband speeds, lower prices,
greater innovation, new investment and better coverage. Almost the whole
UK
population will be able to receive 4G mobile services by the end of 2017
at the latest.

A total of 250 MHz of spectrum was auctioned in two separate bands – 800
MHz and 2.6 GHz. This is equivalent to two-thirds of the radio frequencies
currently used by wireless devices such as tablets, smartphones and
laptops. The lower-frequency 800 MHz band is part of the ‘digital
dividend’ freed up when analogue terrestrial TV was switched off, and is
ideal for widespread mobile coverage. The higher-frequency 2.6 GHz band is
ideal for delivering the capacity needed for faster speeds. The
availability of the two will allow 4G networks to achieve widespread
coverage as well as offering capacity to cope with significant demand in
urban centres.

Ed Richards, Ofcom Chief Executive, said: “This is a positive outcome for
competition in the UK, which will lead to faster and more widespread mobile
broadband, and substantial benefits for consumers and businesses across
the country. We are confident that the UK will be among the most
competitive markets in the world for 4G services. “4G coverage will extend
far beyond that of existing 3G services, covering 98% of the UK population
indoors – and even more when outdoors – which is good news for parts of
the country currently underserved by mobile broadband. “We also want
consumers to be well informed about 4G, so we will be conducting research
at the end of this year to show who is deploying services, in which areas
and at what speeds. This will help consumers and businesses to choose
their most suitable provider.” Widespread 4G coverage Ofcom has attached a
coverage obligation to one of the 800 MHz lots of spectrum. The
winner of this lot is Telefónica UK Ltd. This operator is obliged to
provide a mobile broadband service for indoor reception to at least 98% of
the UK population(expected to cover at least 99% when outdoors) and at
least 95% of the population of each of the UK nations – England, Northern
Ireland, Scotland and Wales – by the end of 2017 at the latest.

Results
A breakdown of what was won, who won it and the base prices payable is
detailed below:
Winning bidder

Spectrum won

Base price

Everything Everywhere Ltd

2 x 5 MHz of 800 MHz and
2 x 35 MHz of 2.6 GHz

£588,876,000

Hutchison 3G UK Ltd

2 x 5 MHz of 800 MHz

£225,000,000

Niche Spectrum Ventures Ltd (a subsidiary of BT Group plc)

2 x 15 MHz of 2.6 GHz and
1 x 20 MHz of 2.6 GHz (unpaired)

£186,476,000

Telefónica UK Ltd

2 x 10 MHz of 800 MHz
(coverage obligation lot)

£550,000,000

Vodafone Ltd

2 x 10 MHz of 800 MHz,
2 x 20 MHz of 2.6 GHz and
1 x 25 MHz of 2.6 GHz (unpaired)

£790,761,000

Total

£2,341,113,000

The following bidders were not winning bidders:
MLL Telecom Ltd
HKT (UK) Company Ltd
The winning bidders now have until 23:59 on 21 February 2013 to pay any
outstanding sums to Ofcom for the spectrum they have won. All proceeds
from the auction will go to HM Government.

Value for consumers In 2012, Ofcom conducted an assessment of future
mobile competition in the
UK<http://stakeholders.ofcom.org.uk/binaries/consultations/award-800mhz/statement/statement.pdf>.
This concluded that consumers were likely to benefit from better services
at lower prices if there were at least four credible national wholesalers
of 4G mobile services. However, going into the auction, Ofcom took the
view that there were only three
operators (EE, O2 and Vodafone) with sufficient spectrum to support such
services. Therefore, in the interests of competition, spectrum was
reserved in the auction for a fourth national wholesaler. That spectrum
has been won by Hutchison 3G UK Ltd. The value of the benefits which 4G
services will provide to UK consumers over the next 10 years (the
‘consumer surplus’) is likely to be at least £20bn, according to
Ofcom estimates. The UK’s communications networks will become more
advanced as 4G is rolled out over the coming months. This new
infrastructure, together with software development, employment
opportunities and new mobile revenues, means 4G is likely to make a
significant contribution to UK economic growth.

Next steps
While the main part of the auction has concluded, there is a final stage
in the process to determine where in the 800 MHz and 2.6 GHz bands each
winning bidder’s new spectrum will be located. Bidding in this final stage
– called the ‘assignment stage’ – will take place shortly.
Following that stage, once bidders have paid their full licence fees,
Ofcom will grant licences to the winners to use the spectrum. Operators
will then be able to start rolling out their networks, with consumer
services expected in spring or early summer 2013. 3G and 4G mobile
broadband speeds research Ofcom will also be carrying out research to
measure the performance of 3G and 4G networks.

This will be broken down by operator and will assess the average mobile
broadband speeds received by 3G and 4G customers. It will be designed to
help consumers understand the performance benefits of 4G over 3G mobile
services and assist them in making informed purchasing decisions.
Ofcom expects to conduct this research around December 2013 and publish
the results in spring 2014. Planning for the future

By 2030, demand for mobile data could be 80 times higher than today2. To
help meet this demand and avert a possible ‘capacity crunch’, more mobile
spectrum is needed over the long term, together with new technologies to
make mobile broadband more efficient. Ofcom is planning now to support the
release of further spectrum for possible future ‘5G’ mobile services3.