Vodafone and BT among winners in £1.4bn 5G spectrum auction

Vodafone and BT have secured spectrum for 5G mobile services in an auction that raised almost £1.4bn for the UK government.

The auction, held by Ofcom, the communications regulator, offered spectrum in two frequency bands: 2.3 GHz, which is for current mobile phones, and 3.4 GHz - one of the bands intended for 5G, the next wave of mobile technology.

Vodafone spent £378.2m on 50 MHz of 3.4 GHz spectrum. It said said it would use the spectrum for applications including connected vehicles and robotics, industrial automated systems and virtual and augmented reality. BT's EE mobile division spent £302.6m on 40 MHz of 3.4 GHz spectrum.

Telefonica, which owns O2, was the biggest bidder, spending £317.7m on 40 MHz of 3.4 GHz spectrum and £205.9m for all 40 MHz of 2.3 GHz spectrum that was available. Hutchison 3G, which runs the Three network, won 20 MHz of 3.4 GHz spectrum at a cost of £151.3m.

In total the auction raised £1.36bn, all of which will be paid to the Treasury.

Philip Marnick,Ofcom's spectrum group director, said: As a nation we're using ever more mobile data on smartphones and mobile devices. Releasing these airwaves will make it quicker and easier to get online on the move. It will also allow companies to prepare for 5G mobile, paving the way for a range of smart, connected devices."

Companies will have one more round of bidding for where their new spectrum will be located in the frequency bands. Ofcom will then issue licences allowing the companies to start using their new capacity.

Once the 5G services are up and running, they will enable gigabit speeds and lower latency to enhance applications including connected vehicles and robotics, industrial automated systems, and virtual and augmented reality.