Airwaves auction could raise £5bn

A new era of faster mobile internet access was signalled yesterday as the communications regulator Ofcom said it was ready to kick off the £5bn sale of another chunk of the nation's airwaves later this year.

Billed as the largest-ever auction of spectrum, it will be fiercely fought-over by mobile phone operators, who have already held up the auction process for three years with the threat of legal challenges. The row has meant Britain has fallen behind many other countries in installing high-speed 4G networks.

Ofcom is selling off the airwaves that until this year carried the analogue TV signal. They can be converted for use by operators such as Vodafone and O2 to boost networks that are under pressure from the extra bandwidth consumed by smartphones such as iPhones and BlackBerrys.

The auction will offer the equivalent of three-quarters of the mobile spectrum in use today. Ofcom has set a £1.4bn reserve, but it is expected to raise closer to £5bn, making it the most valuable asset sold by the government in this Parliament.