10th Oct 2013 14:13
LONDON (Alliance News) - UK mobile operators are set to be charged up to five times more for using wireless spectrum that carries their voice and data services if the UK telecoms regulator gets its way.
Ofcom Thursday published a consultation after proposing higher annual license fees for operators using the 900 megahertz and 1800 megahertz spectrum bands for their voice calls, 3G and 4G services.
Under the proposals, Vodafone Group PLC and Telefonica SA's 02, will have to pay GBP83.1 million a year for using the spectrum, a five-fold increase from the current level of GBP15.6 million. These two operators face the biggest increase because they primarily operate on the more valuable 900 megahertz spectrum, with only a small portion on 1800 megahertz.
EE, owned by Deutsche Telecom and France Telecom SA, is set to pay GBP107.1 million, a four-fold increase from GBP24.9 million, as its 4G services primarily go over 1800 megahertz. It pays the most overall because it has the most services.
Hutchison's 3 will pay GBP35.7 million, up from GBP8.3 million. EE is selling a portion of its 1800 megahertz spectrum, and the proposed fees reflect this.
The UK government directed Ofcom to revise the spectrum fees so they reflect full market value in December 2010, and said it should regard the sums bid for licenses in the 4G auction for the 800 megahertz and 2.6 gigahertz spectrum completed by Ofcom earlier this year in the valuation.
"Spectrum is a valuable and finite national resource," Ofcom said in a statement, "and charging for it can incentivise the optimal use of frequencies."
Ofcom said that it had calculated the market value by analysing the sums paid in the 4G auction, compared those with amounts bid in overseas spectrum auctions, and assessed the technical and commercial characteristics of the UK's spectrum bands.
The consultation on the proposals closes December 19th.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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