Orange and T-Mobile's rivals reacted with anger yesterday after Ofcom's decision to give the networks a significant head-start on offering super-fast 4G mobile internet to their customers.
Ahead of a major airwaves auction starting later in the year, the watchdog announced it had approved plans by Everything Everywhere – the joint venture between Orange and T-Mobile – to use some of its existing spectrum for 4G services.
This means it will be able to provide high-speed mobile internet from 11 September, although Everything Everywhere would only say it will make the service "available later this year".
Everything Everywhere's rivals, however, will not be able to provide 4G services – which will be faster than most home internet connections at up to 20MB a second – until 2013 at the earliest following the auction.
In a livid attack on Ofcom, Vodafone said it was "frankly shocked" by the decision.
"The regulator has shown a careless disregard for the best interests of consumers, businesses and the wider economy through its refusal to properly regard the competitive distortion created by allowing one operator to run services before the ground has been laid for a fully competitive 4G market," it added.
O2 declared itself "hugely disappointed" by Ofcom's decision, saying the announcement "will mean the majority of consumers will be excluded from the first wave of digital services. This decision undermines the competitive environment for 4G in the UK."
Meanwhile, Three said the "liberalisation" of the spectrum "has distorted the competitive landscape in the UK", and added: "Further liberalisation without addressing competition issues could make that distortion worse."
A spokesman for Ofcom responded to the attacks by saying it had "conducted a thorough assessment of how this is likely to affect consumers. The evidence shows that they stand to gain significantly more from the early introduction of 4G, than delaying it.
"The evidence also suggests that it is unlikely to result in any long-term distortion of competition."
The upcoming spectrum auction – which, it is claimed, will result in the service being on offer to 98 per cent of the population – has been delayed for a number of years, leaving UK mobile users unable to use 4G despite it being available in many other countries.
Everything Everywhere also said it is going to launch a third brand later in the year, which is expected to be focused on the new 4G services. The company said the new brand "will sit alongside our existing brands Orange and T-Mobile".
Yesterday also saw Three and Everything Everywhere announce they had agreed a deal that will see the latter sell part of its spectrum, which could be used for 4G services, to the former.