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(Alliance News) - The UK communications regulator on Friday confirmed it will release more airwaves to help improve mobile broadband and support the rollout of 5G in the country.
Ofcom manages the UK's airwaves - or spectrum - a finite resource that is needed for wireless services including mobile phones.
"To help improve mobile services and give more people access to 5G networks, we will release more mobile airwaves through an auction. This will increase the total amount of airwaves available for mobile in the UK by nearly a fifth (18%). Following consultation, we have today confirmed the rules for how the auction will work," Ofcom said.
Companies will now be able to bid for an additional 80 megahertz in the 700 megahertz band and a further 120 megahertz in the 3.6 to 3.8 gigahertz band.
The four companies competing for bids will be BT Group PLC's BT/EE; Hutchison 3G UK Ltd; Vodafone Group PLC and Telfonica SA's O2.
Ofcom said the additional airwaves in the 700 megahertz band will boost mobile networks.
"These airwaves are ideal for providing good-quality mobile coverage, both indoors and across very wide areas - including the countryside. Releasing these airwaves will also boost the capacity of today's mobile networks - offering customers a more reliable service," the regulator added.
The additional space was freed up following a four-year programme to clear the band of its existing uses for digital terrestrial TV and wireless microphones.
In the 3.6 to 3.8 gigahertz band, the primary band for 5G, the additional space will sold off to the four biggest mobile companies following each ones rolled out of 5G in the past year.
The auction will take place over two stages: a principal stage where companies bid for separate 'lots', then the assignment stage when companies bid for specific frequencies.
In the 700 band, 5 megahertz slots will hold a reserve price of GBP100 million per lot. In the 3.6 to 3.8 gigahertz band, the 5 megahertz lots will be reserved at GBP5 million per lot.
Spectrum Group Director at Ofcom Philip Marnick said: "Demand for getting online, on the move is soaring, with mobile customers using nearly 40% more data year on year. So releasing these airwaves will bring a much-needed capacity boost - helping mobile customers get a better service.
"We're also releasing more airwaves to help cement the UK's place as a world leader in 5G."
Ofcom has imposed a cap on any one company owning more than 37% of the overall spectrum. This means, for the upcoming auction, BT/EE is only able to acquire 120 megahertz, or will exceed the cap, H3G can only bid on 185 megahertz, and Vodafone 190 megahertz. O2 will not be restricted by the cap due to its current spectrum holding.
Shares in BT were trading 5.7% higher in London on Friday morning at 113.48 pence each. Vodafone was 5.5% higher at 109.92p. In Madrid, Telefonica was 8.0% higher at EUR4.11.
By Paul McGowan; paulmcgowan@alliancenews.com
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