UK communications regulator Ofcom maintained a competitive market with several service providers during the first largest 4G spectrum sale in over ten years, the latest National Audit Office (NAO) report finds.
However, the report added that it was too soon to arrive at a conclusion whether the bandwidth sale was economically efficient.
Ofcom spokesperson said: "We are pleased the NAO recognises our auction achieved its objective of promoting competition in the 4G market.
"Consumers are now enjoying the benefits, with coverage rising fast and operators competing on price," the communications regulator added.
"4G take-up in the UK is among the fastest in the world, with around four million people already using the technology."
Increasing the amount of spectrum in operation for wireless communications, the bandwidth sold last year also allows for more rapid mobile communications technology.
About £2.4bn was raised through the auction, and the Ofcom anticipated it would offer benefits for consumers worth about £20bn.
Among the four existing national operators including EE, Three, O2 and Vodafone, who all won the spectrum via auction, Three and EE benefited from the auctioning process.
The report said: "During the first stage of bidding, the auction rules allowed bidders to make bids knowing that these were unlikely to be winning bids, helping to disguise their real intentions.
"Our analysis indicates both EE and Three did this during the first round of bidding (Figure 11), but not during the final round," the report added.
"This may have reduced the value of the first stage of bidding, which was intended to inform bidders about the values that other bidders were likely to place on the spectrum being offered."
NAO also revealed that the Three’s bidding strategy was aimed at ensuring it paid only the required reserve price for the spectrum Ofcom set aside to assure a fourth operator would be in the 4G market.
"Three knew early on in the auction that it was the only bidder for the reserved spectrum. In our opinion it is very unlikely that the reserve price was equal to its true value to Three’s business," the report added.
Further, the report added that the two of the bidding firms were narrowed by budget limitations for purchasing the new spectrum, which prevented them from reaching their goal in the auction.
"This meant that they sought to limit the amount they would be required to pay for spectrum in the auction and that they were not necessarily always bidding the full value of the spectrum to their businesses," the report noted.
Some of the bidders for 4G auction found the auction process ‘excessively complex’, which made it complicated to build strong bidding schemes.
