It's too late, it's already been sold

Well done to MPs here, well done indeed, for they’re more than a day late. Which might actually be early for some significant portion of them. They’ve decided to call for coverage standards for 4G – those with licences must agree to cover 95% of the land mass of the country, reducing those rural “not spots” which so plague the yokels. The problem here is that the spectrum to allow all of this to be done was sold off last month.

Just fine to have standards about the level of coverage that must be supplied. I wouldn’t argue that rural areas must be covered – if a commercial operation thinks that it can’t make a profit building stations out there then that’s because it’s a waste of resources to build repeaters out there. But it’s obvious that we can actually impose standards upon suppliers if we wish to make ourselves poorer in that manner.

But we’ve got to do it before we sell the spectrum, not afterwards. Because the price paid is obviously going to be influenced by the costs that must be carried by those who buy it:

Dozens of MPs are urging ministers to force mobile phone operators to plug so-called ‘not-spots’ in rural areas.

Fifty-two MPs from all parties have sent a letter to Matt Hancock, the Digital and Culture secretary, urging him to challenge the speed and roll out of 4G coverage to help communities living in the countryside get a clear signal.

The MPs are calling for a legally binding coverage obligation imposed on all four major operators to deliver mobile coverage to 95 per cent of UK geographic landmass by the end of 2022.

It’s a silly demand in the first place. Much of the Highlands is populated by three cows, two bunnies and a Scotchman. None of whom tend to have much use for mobile coverage given their inability at language. To put it in slightly more formal terms coverage that doesn’t cover the cost, with a profit, of providing it makes us all poorer. We’re wasting scarce economic resources on something that doesn’t produce more than the value of its cost.

With spectrum it’s more immediate than just that economic loss as well. Rightly, we sell the spectrum. The taxpayer gains the price paid by the operators. Load the operators up with more cost and we reduce the amount they pay to taxpayers.

The basic idea that coverage must exist where it’s not economic to have coverage is a bad idea in the first place. But of course, this is politics, it gets worse:

UK TELECOMS WATCHDOG Ofcom has announced that EE, O2, Three and Vodafone were – unsurprisingly – the successful bidders in its 4G and 5G airwave spectrum auction.

The auction, which kicked off just two week’s ago, saw Ofcom offer up 40Mhz of frequency in the 2.3GHz band (which will be immediately available for 4G services) and 150MHz in the 3.5GHz band (which will be used for future 5G services).

Ofcom announced on Wednesday that Vodafone bagged the most 5G airwaves, scoring 50MHz of 3.5GHz spectrum at a cost of £378.254m. BT-owned EE, Three and O2 picked up 40MHz, 40MHz and 20MHz for £302.59m, £317.72m and £151.2m, respectively.

While in the build-up to the auction Three had made the most noise about the 2.3GHz spectrum, Ofcom won all 40Mhz of the ready-to-use 4G spectrum for £318m.

That was a month ago:

05 April 2018

The time to place restrictions or burdens upon the spectrum is before you sell it, not afterwards.

No, we cannot instead turn around and insist that it’s a pretty cool deal. We’ve allowed the bidders to pay prices without the burden, so we’ve got the cash, now we’ll impose those costs. For to do so would be to make everything else the British Government ever sells in the future less valuable. You know, by showing that the British Govnerment are lying, cheating, b’stards who cannot be trusted as far as money is concerned?

Hmm, OK, we knew that anyway but we still shouldn’t reinforce it now, should we?

It’s really pretty simple. A contract is a contract and we don’t go changing the terms after it’s signed and the price agreed. No, not even in politics we don’t.

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jgh
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jgh

I don’t understand people who choose to live miles and miles away from urban infrastructure and then demand urban infrastructure. If you want urban infrastructure there’s a simple answer: live where the urban infrastructure is. And I choose to live in a small town 20 miles from the next nearest comparabily-sized town.

MrYan
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MrYan

Windfall taxes already did this, didn’t they?

Christian Moon
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Christian Moon

4G buyer seems to be O2, at £205.9m, rather than Ofcom (ie the vendor) at £318m as quoted above.

From the Ofcom auction webpage –

“Telefónica UK Limited has won all 40 MHz of 2.3 GHz spectrum available, at a cost of £205,896,000; “