O2 and Vodafone agree spectrum sharing deal as Ofcom auction concludes

The auction increased spectrum available for mobile technology in the UK by nearly a fifth

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O2 and Vodafone have agreed a deal to trade bands in a move they claim will "create more efficient blocks of 5G spectrum".

The deal was announced as part of the final phase of the latest Ofcom spectrum auction, which saw O2 and Vodafone - alongside EE and Three - acquire spectrum in the 700 MHz and 3.6-3.8 GHz bands, for £1.4bn.

During the subsequent assignment stage, which finished this week, the four companies bid for the specific frequency positions they preferred for these airwaves.

The principle deal agreed during this stage saw O2 and Vodafone create a contiguous block of 80Mhz for O2, alongside Vodafone’s blocks totalling 90MHz of spectrum.

02 was granted the license by Ofcom for spectrum blocks covering 703-713 MHz, 758-768 MHz and 3760-3800 MHz, for £448m. They have agreed to share these with Vodafone, which has been granted the license for 3720-3760 MHz for a price of £176.4m.

Vodafone CEO Ahmed Essam said the deal meant his company had “the best possible spectrum to continue giving our customers a fast and reliable 5G service and open up amazing new possibilities for our enterprise customers”.

Optimised spectrum use

EE, which was the biggest spender at the auction, invested £452m to gain the license for spectrum blocks covering 723-733 MHz, 778-788 MHz; 738-758 MHz and 3680-3720 MHz.

Finally, Three now has the license for 713-723 MHz and 768-778 MHz having won bids for a total of £280m.

Philip Marnick, group director of spectrum at Ofcom, said: “Now the auction is complete, these companies can use these airwaves to rapidly rollout better mobile services to people across the UK.

“This additional spectrum will also support the ongoing launch of new 5G connections for people and businesses. Importantly, the bidders also have the flexibility to make trades, so they can optimise use of the spectrum they have won in the auction with their existing airwaves.”

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