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Vodafone and O2 prevail in airwaves row

O2 and Vodafone emerged as the big winners on Wednesday in plans for a shake-up of the airwaves used by the UK’s mobile phone operators.

A government-commissioned report said the two companies should be able to keep their most valuable radio spectrum, despite lobbying by rivals that they give some up.

The report seeks to ensure that a longstanding dispute between the network operators over spectrum does not damage the government’s plans for every home to have broadband internet access by 2012.

Kip Meek, the report’s author, said the dispute should be resolved through a complex set of spectrum ownership restrictions applying to the five network operators: O2 , Vodafone, Orange, T-Mobile and 3.

Mr Meek, a former official at Ofcom, the telecoms regulator, said operators should “share the pain” of ending the dispute but admitted: “There is no solution here which creates a completely level playing field.”

The government is considering directing Ofcom to implement Mr Meek’s findings, in the hope that dis-affected operators would not then mount a legal ­challenge.

Mr Meek decided against calling for O2 and Vodafone to give up their valuable spectrum at the 900 megahertz bandwidth, which is suitable for providing internet access on mobiles in rural areas.

O2 and Vodafone want to stop using this spectrum for basic phone calls and text messages and reallocate it to sophisticated services based on third-generation mobile technology such as faster web browsing.

Orange and T-Mobile, which do not have 900 MHz spectrum, signalled their disappointment with Mr Meek’s report.

However, Mr Meek said O2 and Vodafone should be barred from a future auction of spectrum at the 800 MHz bandwidth unless they gave up some 900 MHz.

The 800 MHz spectrum is also suitable for extending mobile broadband to rural areas where it may be too expensive to install fixed-line internet connections.

It is currently used for analogue television transmission but will become available with the 2012 digital television switchover.

However, Mr Meek said O2 and Vodafone should be able to reallocate their 900 MHz to new mobile services before their rivals get the 800 MHz. This could give them a “first mover advantage” of two years or more.

Mr Meek said that if the airwaves row was solved, the UK could enjoy mobile broadband download speeds of four megabits per second by 2014.

The government wants speeds of up to two megabits per second by 2012, to enable viewers to watch video over internet services such as BBC iPlayer.

Источник: Financial Times

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