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5G spectrum auction to go ahead in April after Three’s legal challenge fails

OFCOM’S 5G SPECTRUM AUCTION will go ahead in April after Three failed in its last-ditch attempt to force a change to the bidding rules.

The forthcoming auction of 4G and 5G-friendly radio spectrum in the 2.3GHz and 3.4GHz bands was originally set to take place in autumn 2017. However, it delayed after Three launched a legal challenge calling for Ofcom to impose a 30 per cent spectrum cap, slamming the watchdog’s proposed 37 per cent cap as “meaningless” and bad for competition. 

While BT-owned EE, which owns 43 per cent of spectrum at present, accepted Ofcom’s 37 per cent cap for 4G services, it also launched legal action to stop Ofcom imposing the same cap for the 3.4GHz 5G band.

Both claims were dismissed by the High Court in December, which Three appealed against. On Tuesday, the Court of Appeals also slapped down this challenge. 

An Ofcom spokesman said: “The Court of Appeal has very firmly rejected Three’s application for permission to appeal on all grounds.

“We welcome this decision, and will now press ahead with releasing these important airwaves. This new capacity will allow mobile companies to offer more reliable reception, and to prepare for future 5G services.”

In a statement sent to INQ, Three said it is “disappointed” by the Court’s decision, and said that it still believes the 37 per cent cap is “too high” and will continue to hamper competition in the UK.

“First of all this has not caused any delay to the delivery of 5G services to UK consumers which are not expected to rollout until 2019/20, according to Ofcom.  But more importantly, our appeal is about competition in the UK mobile market and spectrum distribution is the single biggest factor in maintaining a competitive market,” a spokesperson said.

“The court process has helped provide clarity on whether there is a genuine 37 per cent cap and, thanks to the hearings,  Ofcom is now much clearer that a 37 per cent cap is the level they believe is appropriate to maintain competitive balance. However, that cap will not be in place until Q2 2020 but it is vital that Ofcom, as a minimum starting point, sticks to this number when additional spectrum is auctioned off.

“We still believe that a 37 per cent cap is too high if the policy objective is to have a competitive four-player market and we would like to see it set at a lower level in the future.”  µ

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