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Report: Spectrum auction winners announced, wait for PMSE compensation continues

As expected, major mobile phone companies were the big winners in the latest round of spectrum auctions. Here, PSNEurope’s Kevin Hilton reports on the current situation and how it might affect wireless microphone users...

Uncertain times continue for users of radio microphone and in-ear monitoring (IEM) systems in the UK. While they await both details of financial packages to compensate them when the 700MHz band is cleared in 2020 and the outcome of ongoing discussions over proposed new frequencies for PMSE (programme making and special events), the first in a series of spectrum auctions giving more wireless capability to mobile phone operators has been completed.

Bidding for airwaves had been running for the 2.3 GHz and 3.4GHz bands, with many of the big name players taking part. Right now the 2.3 GHz band is used for existing mobile phones and will provide further enhancements to 4G capacity. The next move on from 4G, currently available for video streaming and downloading, as well as telephony and email, is 5G. This has provisionally been allocated 3.4GHz, which is viewed as being capable of accommodating the next level of mobile technology.

In total 34 ‘lots’ of spectrum were offered for auction over the two bands. Five companies took part in the bidding process, four of which were successful. EE, the mobile network operator and internet service provider created by the merger of Orange UK and T-Mobile UK and now owned by the BT Group, gained 40MHz of 3.4GHz, bidding £302,592,000. Hutchinson 3G UK, which operates mobile phone and broadband services under the Three brand name, won 20MHz of 3.4GHz for £151,296,000. Telefónica UK, a subsidiary of the Spanish telecom group that trades as O2, took all 40MHz in the 2.3GHz band for £205,896,000 and 40MHz of 3.4GHz at £317,720,000. Vodafone, the world’s second biggest mobile phone company, won 50MHz of 3.4GHz at a price of £378,720,000.

The fifth bidder, Airspan Spectrum Holdings, a provider of LTE (long-term evolution) small cells and backhaul technologies for mobile radio access networks, did not win spectrum in either band. The total raised by what broadcast and spectrum regulator Ofcom describes as “the principal stage” of auctions for 4G and 5G is £1,355,744,000. The money generated as a result of the sale of these frequencies will now go to HM Treasury.
The next and final step in the bidding process will be ‘assignment’. This involves the winning companies vying to establish where in the frequency bands the spectrum they have acquired will be placed.
Commenting on the outcome of the auction, Philip Marnick, spectrum group director at Ofcom, said, “This is good news for everyone who uses their mobile phone to access the internet. As a nation we’re using ever more mobile data on smartphones and mobile devices. Releasing these airwaves will make it quicker and easier to get online on the move. It will also allow companies to prepare for 5G mobile, paving the way for a range of smart, connected devices.”

Kester Mann, principal analyst of operators at market information and analysis firm CCS Insight, comments that the “big winner” in this bout of the spectrum sell-off is O2. “They’ve swept up all of the crucial 2.3GHz airwaves that can immediately offer much needed 4G capacity,” he says. “Vodafone will also be satisfied, spending the most on 5G spectrum. The outcome for Three will do little to improve its precarious market position. EE’s strong spectrum position meant it was unable to bid for 4G airwaves. Its spend on 5G spectrum will support a strategy to launch commercial services in 2020.”

Mann observes that the outlay of £1.4 billion in total was higher than expected, reflecting a “hugely competitive sale” involving frequencies that will play major roles in the long-term future for each network. “Attention now moves to the 700MHz sale,” he adds, “another 5G band that is vital for wide-area coverage. That could be auctioned in the UK as soon as next year.”

This is the critical part in the new allocation of spectrum for PMSE. Alan March, senior manager of spectrum affairs and system design at Sennheiser and a spokesman for industry body BEIRG (British Entertainment Radio Industry Group), comments that the reallocation of 2.3GHz and 3.4GHz does not directly affect wireless mic and IEM users but points out potential concerns over proximity: “Deployment of LTE in the 2.3GHz band, if not carefully managed, could potentially compromise the bottom end of the 2.4GHz ‘Wi-Fi’ band. The effect could be to constrain capacity in the 2.4GHz band due to out of band interference from newly deployed LTE services. There are some audio products that operate in the 2.4GHz band but they are not what could be regarded as ‘professional’ products.”
March and others involved in the PMSE debate are currently in discussions under the auspices of CEPT (European Conference of Postal and Telecommunications Administrations) over proposals for UK wireless mics and IEMs to move into the 960-1164MHz Air Band. March observes that this is opposed by the aeronautics sector and authorities in France, despite Ofcom’s insistence that it will go ahead.

The Department for Digital, Culture, Media and Sport (DCMS), which is overseeing the drawing up of compensation packages for PMSE users forced to move frequencies and buy new equipment, told PSNEurope in April that an announcement would be made “in the next few weeks”. 

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