NAO to see whether Ofcom 4G auction undersold the country’s spectrum resources
The National Audit Office (NAO) has confirmed to TechWeekEurope that it is investigating whether the Ofcom 4G spectrum auction achieved value for money.
The auction yielded £2.31 billion for the treasury, £1.2 billion less than it had accounted for, and significantly less than the total amount that some had suggested could be raised.
Ofcom said that the aim of the auction was not to generate revenue for the government, but to promote competition that will ensure consumers will benefit from the rollout of 4G services.
Ofcom 4G auction investigation
“The 4G auction was a success, which will deliver the maximum benefit to UK citizens and consumers – in line with Ofcom’s statutory duties,” said a spokesperson for the regulator. “It will create competition, with five companies able to launch competitive 4G services. This will lead to investment in new services, greater innovation and lower prices, plus enhanced coverage with a rule to cover almost all of the UK population by 2017 at the latest.”
“The auction was designed to promote competition and ensure coverage, rather than to raise money,” they added. “These benefits will deliver significantly more value in the long term to the UK than simply the revenue raised in the auction.”
Helen Goodman, MP for Bishop Auckland and shadow secretary for Culture, Media and Sport had claimed on Twitter that she had requested that the NAO investigate the auction. However the NAO said that although she had written to them to express her concerns, its investigation was not prompted by her correspondence.
It had been suggested that fierce bidding for the UK’s largest ever sake of mobile bandwidth could raise as much as £4 billion, and the Chancellor, George Osborne earmarked £3 billion for deficit reduction, however such speculation proved wide of the mark. Vodafone won the most spectrum, paying £790.8 million, with O2, Three, EE and BT also securing valuable airwaves.
EE currently operates the UK’s only 4G network after it was granted permission to launch an LTE service using its existing 1800MHz spectrum, however other operators are expected to follow suit later this year.
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