Vodafone beats O2, EE and Three to take biggest share of 5G spectrum

Rival O2 took all the 4G spectrum up for auction

The communications watchdog auctioned off airwaves in two frequency bands: one usable for 4G; one for the bands earmarked for 5G service in the future (iStock)

Ofcom has raised £1.36bn from its auction of mobile airwaves for 4G and future 5G services, the regulator announced on Wednesday.

The communications watchdog auctioned off airwaves in two frequency bands: 2.3 GHz (gigahertz), usable by current mobile phones for 4G service; and 3.4 GHz, which is one for the bands earmarked for 5G service in the future.

Vodafone had the biggest win, taking 50 MHz (megahertz) of 5G spectrum, paying £378.2m for its share.

EE won 40 MHz of 5G spectrum at a cost of £302.6m, and Hutchison, owner of the Three network, took 20 MHz of 5G, costing £151.3m.

Meanwhile, Telefonica, which owns O2, won all 40 MHz of 2.3 GHz spectrum (used for 4G), at a cost of £205.9m. The Spanish group also paid £317.7m for 40MHz of 5G spectrum.

The total £1.36bn raised will be paid to the Treasury.

Airspan Spectrum Holdings, which is backed by Japan’s SoftBank, also took part in the auction process, but did not win any spectrum.

“This is good news for everyone who uses their mobile phone to access the internet,” said Ofcom’s spectrum group director, Philip Marnick.

“As a nation we’re using ever more mobile data on smartphones and mobile devices. Releasing these airwaves will make it quicker and easier to get online on the move.

“It will also allow companies to prepare for 5G mobile, paving the way for a range of smart, connected devices.”

EE and Three both went to the High Court last year to challenge Ofcom's plans to cap the amount of mobile spectrum that any operator can own at 37 per cent.

EE argued that it was too restrictive, while Three claimed it was too generous. Both companies lost their cases.