Tuesday, August 21, 2012

Ofcom allow Everything Everywhere to launch 4G services

Following a consultation earlier this year (more here), Ofcom have today allowed Everything Everywhere to launch 4G services using its existing spectrum holdings in advance of the 4G auction later this year. Everything Everywhere, which has previously conducted trials of the technology, will be able to launch services from 11 September 2012.

Ofcom considers that the benefits to consumers outweigh any risk of distorting competition by allowing Everything Everywhere to proceed in this way. From Ofcom's press release:
"Varying EE's licences would allow EE to provide better quality data services to consumers, for example with higher speeds and lower latency, than can be offered by operators using 3G technologies and existing spectrum holdings. Accordingly, we expect that consumers that choose to take EE's LTE service will derive benefits that they would not otherwise enjoy were we not to vary EE's licences now. 
Although we consider it likely that EE will enjoy a competitive advantage during the period before other operators are able to launch their own LTE services, we consider on the evidence available that any such advantage is unlikely to result in an enduring advantage which distorts competition to the detriment of consumers. Our assessment takes account of the impending release of additional spectrum in the 800 MHz and 2.6 GHz bands which will enable other operators to launch competing LTE services during the course of 2013. We have also taken into account EE's obligation to divest itself of some its 1800 MHz spectrum. 
In light of this assessment, and for the reasons explained in more detail in this decision, we consider that it is in the interests of consumers for us to vary EE's licences now, in accordance with EE's request. We have therefore today issued EE with varied 1800 MHz licences with the provisions authorising LTE and WiMAX coming into force on 11 September 2012."
Coverage from the BBC here, ISP Review here, the Register here and the Telegraph here. It was reported yesterday that final agreement of the sale of some of Everything Everywhere's spectrum to rival operator Three was imminent. This from the Guardian:
"Ofcom said in March it was "minded" to approve liberalisation of the 1800 band, currently licensed for 2G and 3G services. However, after protests from rivals that EE would have an unfair first mover advantage, it extended the consultation period. EE had originally hoped to have its service running this autumn, having applied for liberalisation last November. 
Ofcom is thought likely to approve EE's request, although it may impose conditions such as a later launch date than the company is hoping for. 
Meanwhile, sources have confirmed that EE is on the verge of announcing a deal with Three, owned by Hong Kong conglomerate Hutchison Whampoa. The European commission had ordered EE to sell a quarter of its 1800 holding as a condition of approving the T-Mobile/Orange merger. 
Vodafone and O2 also bid for the spectrum, but it is thought they have missed out. The sale, arranged by EE's financial adviser Morgan Stanley, would not necessarily allow Three to launch 4G this year. This is because EE is not obliged to clear the spectrum until September 2013."
From the Financial Times yesterday ("Everything Everywhere in spectrum talks"):
"Everything Everywhere is in advanced discussions to sell part of its crucial spectrum holdings capable of carrying next generation 4G mobile services to Three...The deal would give Three guaranteed ownership of rare spectrum that can carry superfast 4G mobile broadband, and potentially at a lower price than bidding against its three rivals in the much delayed auction of lower frequency 4G spectrum pencilled for the end of the year by Ofcom...Those with knowledge of the discussions cautioned the deal had not been finalised, but one added that an agreement was “imminent”."
Similar coverage in the Telegraph.

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