4G Spectrum Auction Will Determine Winners and Losers in the UK Mobile Market

United Kingdom represents a critical juncture for country’s wireless market, with the winners set to gain access to data bandwidth essential for meet burgeoning demand for mobile data services.

U.K. mobile data traffic will rise by more than 400 percent from 2012 to 2016, according to a new report from IHS. They forecast mobile data traffic in the country will rise to 1.4 billion gigabytes in 2016, up from 274 million gigabytes in 2012.

The auction features 2.6Ghz spectrum best suited for urban deployments and scarce spectrum at the 800MHz band, which is especially suitable for delivering wireless services in rural areas. This makes 800MHz desirable for any nationwide deployment of 4G.

“The importance of this spectrum auction in shaping the future of the U.K. wireless market cannot be understated,” said Daniel Gleeson, mobile analyst at IHS. “Access to spectrum is the main barrier to entry for any company looking to build a new wireless network. The amount a company spends in the auction will affect their business performance for years to come. Seven companies are bidding for spectrum: the country’s four existing mobile operators along with three new players. With only three companies likely to win spectrum, at least one of the United Kingdom’s existing operators is likely to lose out.”