COVID, potential consolidation, implications for ALF pricing and non-contiguous blocks have conspired to make the forthcoming second 5G spectrum auction a highly complicated affair.

Contents

Executive summary

Two-stage approach raises significant issues

Either way, competitive playing field to level

Consolidation prospects to have little impact

Complications create uncertainty over proceeds

Who’s likely to want what

Why H3G may hold back

Historic prices not necessarily a strong guide

Spectrum limits unlikely to be a constraining factor

Non-contiguous spectrum causes inefficiencies and risk

Ofcom negotiation process may not resolve the issue

How realistic is spectrum trading?

Not all spectrum is equal

Consolidation issues to be put to one side

 

List of charts/tables

Figure 1: Spectrum available in the 2021 auction

Figure 2: Spectrum holding by operator (MHz)

Figure 3: UK MNO market shares, 2019

Figure 4: Reserve price and historic market value of spectrum for auction

Figure 5: Reserve and historic prices by operator on reasonable spectrum allocation scenario

Figure 6: Reasonable scenario of spectrum distribution and spectrum caps

Figure 7: Spectrum allocation in the 3.4-3.8 GHz band

Figure 8: Operator potential shares of spectrum and capacity post-auction

Figure 9: Operator shares of capacity

Figure 10: Mobile network utilisation by operator