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LONDON (Alliance News) - UK telecoms regulator Ofcom published a consultation on the revision of annual license fees for the 900 megahertz and 1800 megahertz spectrum bands Thursday.
The two spectrum bands are currently used by mobile operators for voice calls, 3G and 4G services. The Government directed Ofcom to revise fees so they reflect full market value in December 2010, and told 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."
Under this new valuation, Vodafone Group PLC, Telefonica 02 UK Limited, EE Limited and Hutchinson 3G UK Limited will face large increases in annual licence fees. Vodafone and O2 currently pay GBP15.6 million in annual licence fees, and are both proposed to pay GBP83.1 million. EE currently pays GBP24.9 million, and is proposed to pay GBP107.1 million. H3G currently pays GBP8.3 million, and is proposed to pay GBP35.7 million. EE will finalise its divestment of its portion of 1800 megahertz spectrum to H3G in October 2015, and the proposed fees reflect this.
Ofcom said that it had calculated the market value by analysing the sums paid in the 4G auction, comparisons to amounts bid in overseas spectrum auctions and assessing the technical and commercial characteristics of the UK's spectrum bands.
The consultation closes December 19th.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
Copyright 2013 Alliance News Limited. All Rights Reserved.
