Market Intelligence – UK spectrum auction’s legal challenges pressure country’s 5G migration

A monthslong delay to the U.K.’s planned spectrum auction due to legal disputes over the auction’s rules will further slow 5G rollouts in the country, telecommunications experts said.

“When you allow a merger between BT and EE, you are creating a company that collectively has £24 billion in revenue,” said Bengt Nordström, CEO of telecoms consultancy Northstream. “O2 and Three would have been an £8 billion revenue company which would have been three times smaller than BT’s EE.”

Telecommunications executives in Britain and across Europe continue to argue in favor of mergers to allow businesses to free up capital for investment in costly infrastructure and 5G technology. However, Europe’s regulators maintain that moving from four to three network operators in the U.K. will lead to higher prices for consumers.

Northstream’s hope is that the regulatory climate for mergers will improve, because the current market dynamics are not working, Nordström said.

“There is a challenge for many number four players,” he said. “It’s very hard to fund the business when you are the smallest player in the market.”

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Market Intelligence - Legal disputes over spectrum hang a cloud over O2 IPO

Uncertainty over its ability to acquire more airwaves is putting pressure on IPO plans for Telefónica SA’s O2. But its peers may be facing similar headwinds. In July, Britain’s regulatory watchdog Ofcom announced that a U.K. spectrum auction due to take place later this year would prevent operators from owning more than 37% of the overall share of mobile spectrum available [...]
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