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Cable.co.uk comments on Ofcom mobile spectrum licence fees announcement

  • Revised annual fees from mobile operators to rise more than 300%
  • After extensive consultation period, Ofcom has ruled mobile industry must 'pay market value'
  • Rise may provoke price increases to consumers

24 September 2015 : This morning, Ofcom announced an effective tripling in the licence fees the UK's four network providers must pay annually for their share of the 900 MHz and 1800MHz spectrum bands, which they use to provide voice, and data via 2G, 3G and 4G technologies.

As well as the price rise, Ofcom is altering the current way fees are paid – distributed across the year – to a single, annual pay date. The move comes a full five years after the government directed Ofcom to revise fees to reflect market value.

The full Ofcom press release can be read at media.ofcom.org.uk

Dan Howdle, telecoms expert at consumer mobile and broadband advice site, Cable.co.uk had this to say about the announcement: "There can be absolutely no doubt as to the fairness of simply ensuring the UK's mobile network providers pay a fair price for what is absolutely a finite resource.

"But, of course, the money has to come from somewhere. And while, on paper, O2, Vodafone, Three and EE appear in arguably rude health from the perspective of their announced operating profits earlier this year, behind closed doors they are unlikely be happy to see their war chest diminished.

"That Ofcom is 'phasing in' the move to a yearly lump-sum payment for the licence fees will make it especially difficult to detect when, if and how these costs will be passed on to consumers, either directly or indirectly via the fees paid by mobile virtual network operators (MVNOs) such as Virgin Mobile and giffagaff to piggyback their network infrastructure."

Notes to editors

  • If using our research and/or commentary we would deeply appreciate a link either to this page or to https://www.cable.co.uk

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What is Cable?

Cable is a broadband, TV and phone comparator, unique news source and consumer champion.

Dan Howdle has been plugged into the attitudes of UK broadband, TV and mobile customers for over two decades, running research fieldwork both nationally and internationally on behalf of the biggest players in the industry. Dan is now consumer telecoms analyst at Cable, as well as more formally operating in the role of its Director of Communications and Content.

An experienced broadcaster, commentator and writer, Dan has appeared on BBC TV and radio, ITV, Sky and in the national papers. Dan has advised Ofcom on issues surrounding service quality, administered Cable’s Broadband Service Quality Awards and sat on the panel of judges for the Internet Service Providers Association annual awards.

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