O2 has publicised its response to Ofcom’s proposals for auctioning the UK radio spectrum that’ll be used for 4G LTE mobile services. The proposals were first announced in March.
Ofcom is proposing ‘caps’ to prevent any single bidder gaining a large amount of spectrum, along with ‘floors’ of minimum ownership. These floors would cover all sub-1GHz spectrum, which means O2 and Vodafone’s existing 900MHz frequencies would be included.
In a statement, O2 says “we believe that the proposed spectrum floors are a state aid and are therefore illegal under EU law. The spectrum floors would distort the auction process, allowing all bidders, except Vodafone and O2, to potentially acquire spectrum at discounted prices. Ofcom’s own figures suggest this effect could cost taxpayers £1 billion”.
The auction is currently expected to take place in early 2012.