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Ofcom to triple spectrum charges for Vodafone, O2, EE and Three

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By Tony Connelly, Sports Marketing Reporter

September 24, 2015 | 2 min read

Ofcom has announced that it will triple the spectrum charges for Britain’s mobile phone operators despite warnings from the companies that it would result in higher bills for customers and a delay in the roll-out of faster 4G networks.

The telecoms regulator revealed that it will take £199.6m a year from charging Vodafone, O2, EE and Three to use Britain’s airwaves, which is more than three times the £64.4m it currently draws in.

Ofcom settled on the final figure after coming under fierce criticism from mobile operators last year when it was revealed that it intended to charge £228.3m - a five-fold price hike. Mobile operators have been staunchly against the huge increasing, arguing that customers would be affected with higher phone bills and delays in fast 4G being implemented.

The government tasked Ofcom with introducing market rates for bandwidth in 2010 as it looked to make money out of the spectrum which it had previously done by auctioning off bandwidth to use for 4G service.

Ofcom's group director of spectrum, Philip Marnick, attributed the increase to mobile operators not paying “market value for access to the spectrum”. He said Ofcom had “conducted a complex and comprehensive analysis to determine the new fees” and added that the new fees reflected the value of the spectrum as a “valuable and finite resource”.

The new fees will be introduced in two phases and will be in place by October next year. Each operator will pay a different sum based on which tranche of bandwidth they use. Vodafone and O2 will face a three-fold increase in fees from £15.6m a year to £49.6m. EE’s will see its charges rise from £24.9m to £75m, while Three’s bill will increase from £8.3m to £25m.

Ofcom O2 Three

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