Labour lashes out at Govt's long delayed 4G auction

Labour is blaming the Conservatives for the delays in the 4G mobile spectrum launch, which it claims is costing the economy £1m a day. Labour has blamed the Government for not being firm enough with Ofcom regarding the 4G mobile spectrum auction, and that the ongoing delays have cost the economy millions. Helen Goodman, Labour's Shadow Minister for Media, states that alongside the auction itself which is expected to raise £2-4bn in capital, the Government is also missing out £300m a year in licensing fees. Following the current round of consultation, the auction is now due to occur late this year, with 4G network rollouts in mid-2013 at the latest. "The auction could have taken place in 2010 but this government decided not to give Ofcom the backup to go ahead with the sale of 4G," said Goodman. It is possible that 4G networks may not be available until 2015. "Consumers need better mobile coverage, particularly in rural areas, and it is disappointing that it has taken the government 18 months to get on with the auction," Goodman said. "At a time of deep cuts to the public sector, the government is in effect losing almost £1m in revenue a day. We will be one of the last major countries in Europe to get 4G coverage, which is shameful because Britain is one of the largest producers of mobile phone technology in the world." A 4G spectrum auction was originally looked at in 2009, but 4G standards were not finalised at the time. Since then, Ofcom claims problems aligning UK spectrum with Europe and our slow analogue TV switch off saw the process drag out across 2010-2011. Other have been swift to disagree. Ofcom also claims it is focusing on ensuring the current, already overloaded 2G and 3G networks are stable for the Olympics, a justifiable enough goal, but one which will not please technophiles, businesses or especially rural customers. Mostly the arguments have been over how the auction should be conducted. Ofcom wants to preserve competition, while the mobile operators want to ensure there is no repeat of the 3G auctions in 2000. Those auctions netted the government an unexpected and astonishing £22bn - but this left many operators debt riddled and struggling to build and then monetise their investments, leading to the telecoms crash of 2001. A supposedly final round of 4G consultation completed in May 2011, with the auction due to occur around now. Threatened lawsuits from Vodafone and O2 saw Ofcom open a second round of consultation, which began last week. Both Vodafone and O2 already have some 4G spectrum, and weren't happy at perceived corporate welfare to the other market competitors. France Telecom and Deutsche Telekom's Everything Everywhere (owners of Orange Mobile and T-Mobile) as well as Hutchison-Whompoa (owners of Three Mobile) were to have spectrum reserved for them in the 800Mhz spectrum, alongside overall bidding limits, which Ofcom claimed was to preserve a competitive 4G market with four big mobile operators. Ofcom released its revised proposal document last week, which has seen Everything Everywhere lose this reserved 800MHz spectrum. Ofcom now claims Everything Everywhere already holds enough 4G compatible 1800MHz spectrum. The proposal also pushes two new approaches to pushing national mobile coverage past the previous threshold of 95%. Germany has completed its spectrum auction, earning its government €4.4bn, and German telcos are already beginning to rollout 4G networks. France's radio spectrum auction is currently under way. The US already has a functioning 4G network and last week's CES show saw the second generation of 4G phones unveiled. If the UK's networks aren't up before 2015, by Goodman's estimations it will have cost the economy £1.5bn pounds. 4G has been much hyped as a solution to the rural/urban digital divide, which has seen telcos struggling to economically justify rolling out high speed broadband to rural areas. 4G would wirelessly produce similar broadband speeds to what general fixed line users in UK cities receive today.