UK Defence Ministry to auction off radio spectrum

Britain's Ministry of Defence announced overnight that it will auction off some of the radio spectrum usage rights it holds.

Minister for Defence Equipment, Support and Technology, Philip Dunne, said that some 200 MHz worth of spectrum below 15 GHz will be sold off to the highest bidders.

The spectrum can be used for 4G by private telco operators, Dunne said. MoD expects to auction off the spectrum by the northern summer 2014.

In its 2010 spending review, the UK government flagged at least 500 MHz of public spectrum below 5 GHz would be released for new mobile communications use.

Currently, half of all British radio spectrum below 15 GHz is held by the public sector for defence, emergency services, transport and science use. 

The MoD holds nearly three-quarters of the public radio-frequency spectrum, of which a third is below 15 GHz.

The decision to sell off the spectrum usage rights comes after the Netherlands' Government realised more than twice the expected amount in fees in its 4G radio frequency auction last week, reaping A$4.74 billion.

Prices in the Dutch auction went so high that one of the succesful bidders, KPN, owned by Mexican tycoon Carlos Slim Helu, said it will have to cancel its final dividend for this year, and cut the one for 2013 to 0.03 euros (A$0.04) per share.

Britain will auction off initial batches of 4G radio frequency spectrum in May and June next year, and the cash-strapped British Government hopes it will bring in £3.5 billion (A$5.4 billion), according to a report by the BBC.

Last week, Australia's communications minister Stephen Conroy set a high price for Australia's 700 MHz spectrum auction next year, prompting outcries from the telco industry that the charges are "unrealistic and unworkable".