The qualifying companies are British Telecommunications Plc, Cable & Wireless UK, Centric Telecom Ltd, Colt Mobile Telecommunications Ltd, Cyberpress Ltd, FMS Solutions Ltd, Mapesbury Communications Ltd, ntl Group Ltd, 02 (UK) Ltd, Opal Telecom Ltd, Orange Personal Communications Services Ltd, PLDT (UK) Ltd, Shyam Telecom UK Ltd, Spring Mobil AB, Teleware Plc, and Zynetix Ltd.
Ofcom said the licenses will be technology- and application-neutral, but the expectation is that they will be used to offer low-powered GSM services so that once students for example enter a university campus, or employees enter their office, their mobile handsets will pick up the low power GSM network that allows them to utilize potentially cheaper network call charges.
The calls are made over the office or university GSM network and once they leave the area, the handset switches back over to a national mobile network such as Vodafone or Orange. The system has considerable advantages over WiFi in that GSM is optimized for voice so the quality of calls is better and no change to existing GSM phones is required.
Ofcom announced back in January 2005 a rolling program of awards for all of the available spectrum in the next seven or eight years. The UK government is especially keen to sell parts of unwanted or unused spectrum in order to raise funds for the government’s coffers.
In December 2004, the British Chancellor Gordon Brown commissioned Professor Martin Cave to conduct an Independent Audit of Spectrum Holdings, with the aim of releasing the maximum amount of spectrum to the market. In the UK, one-third of the available spectrum is used for defense, maritime, aeronautical, scientific, and emergency services.
More and more spectrum is being freed up in the UK due to improving technologies. For example, the above list of applicants had qualified to bid for the award of spectrum in the bands 1781.7-1785MHz paired with 1876.7-1880MHz. This spectrum had been awarded in July last year.
This spectrum is known as short dect guard band, said Simon Bates, an Ofcom spokesperson. This spectrum previously acted as a buffer zone between digital cordless telephony (wireless telephone handsets in the home) and mobile phones. It was there to make sure these technologies didn’t interfere with each other, but as technology has improved, this buffer zone is no longer needed.
There will be a single-round, sealed-bid auction in April where bidders will submit a figure for a license if seven licenses are issued, another figure if eight license are issued, right the way through to if 12 licenses are issued. The highest bid wins, but the reserve price is 50,000 pounds ($86,939) upwards.
