Ofcom increases spectrum fees for UK operators

Ofcom, the UK regulator, is increasing spectrum fees for the country’s four mobile operators — but by less than it threatened in its review in February 2015.

Total annual fees for spectrum in the 900 and 1800 megahertz band will go up to £199.6 million a year from October 31, compared with £64.4 million a year now. But that is less than the £228.3 million a year Ofcom proposed earlier.

“We have listened carefully to the arguments and evidence put forward by industry, and conducted a complex and comprehensive analysis to determine the new fees. The mobile industry has not previously had to pay market value for access to this spectrum, which is a valuable and finite resource, and the new fees reflect that value,” said Philip Marnick, Ofcom’s group director of spectrum.

Operators have previously paid the fees at different points in the year but will in future pay on a single common payment date set by Ofcom. The new fees come into effect in two phases: one half of the fees increase, from the current to the new rates, will come into effect on October 31.

The fees in this release are expressed in August 2015 prices. Each year, the fee rates will be updated for inflation.

Vodafone and Telefónica O2’s fees each rise from £15.6 million to £49.8 million for the 900 and 1800 megahertz spectrum. EE’s fee goes up from £24.9 million to £75.0 million. Three’s payment rises from £8.3 million to £25.0 million. 

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