O2 bags Midlands driverless gig

O2 has announced a partnership with Wireless Infrastructure Group (WIG) to deliver connectivity for driverless vehicle test bed trials in the West Midlands.

With the UK government foolishly promising driverless cars will be on the roads by 2021, this is one of a number of trials located in the Midlands to make the wayward ambition a reality. As part of the agreement, O2 claims it will deliver Europe’s largest fibre connected small cell network along a 50-mile route that runs through Birmingham and Coventry.

“Following our successful deployment of the UK’s first centralised radio network (C-RAN) in Aberdeen, in partnership with WIG, we will be using this same cutting-edge technology across what we expect to be Europe’s largest fibre connected small cell network,” said Brendan O’Reilly, CTO at O2. “Mobile powers our modern world and 5G has even more potential to move Britain forward which is why we’re excited to be working together with WIG to continue to build this technology into the fabric of our cities and communities.”

“We are delighted to be working with O2 and WIG to test autonomous vehicles on roads here in the West Midlands,” said Andy Street, Mayor of the West Midlands. “As the heart of the UK’s future mobility research and development, and the UK’s first region-wide 5G testbed, the West Midlands is well-positioned to create thousands of new jobs in the industries of the future.”

With the UK desperate to prove it is at the forefront of the technology world, the UK government has promised driverless cars will be commercially available by 2021, a laughable ambition when you think of the work, both from a technological and administrative perspective, which will have to be done ahead of this point. The Midlands is certainly a beneficiary here, as the region has been attempted to create a regionalised technology hub around electric and driverless vehicles.

We’re sceptical driverless cars will be anywhere near a reality in the near future, though at least it is another usecase for 5G ROI.

Q3 validates O2 indifference towards convergence

Telefonica’s UK business O2 has continued a strong 2018 performance with a 7.9% increase in revenues in the third quarter, while it greedily captured an additional 120,000 subscribers.

The results perhaps justify the businesses decision not to enter into the convergence fight. Back in July, CEO Mark Evans confirmed the business would continue to focus on its mobile-only proposition, and wasn’t convinced entirely by the idea of bundled services. This statement is certainly contradictory to many telcos across the world, including its own cousin, Telefonica Germany, which plugged 5G FWA at Broadband World Forum. That said, the numbers speak for themselves.

Over the last three months, total revenues stood at £1.5 billion, up 7.9% year-on-year, while mobile service revenues grew by 3.4%, thanks to customers choosing larger bundles and MVNO growth. The O2 network now has 32.3 million customers, including MVNOs such as Lycamobile, making it the busiest network in the UK. Churn was also down to 1%, which O2 claims is the best in the UK.

“We continue to put the customer at the heart of our business, delivering leading propositions and unique customer experiences, as demonstrated by the launch of our revolutionary O2 Custom Plans, exclusively available in our direct channels,” said Evans. “O2 Custom Plan offers customers real choice, by giving them control, flexibility and transparency, and has once again driven the O2 point of difference in the market.

“Our on-going commitment to invest in our network includes enhancing 4G connectivity and preparing the ground for 5G. As champions of mobile we continue to build for the future, where mobile is one of the most powerful opportunities to strengthen the UK economy and enrich our society.”

This laser like focus on mobile is probably best for everyone involved. Despite O2 leading in the market share race, it has consistently been condemned for having the worst network in the UK. This has been confirmed quarter after quarter, by a variety of different sources. Some might come to the conclusion the consistency of poor performance simply suggests the management team does not care that much. However, efforts are being made to improve this record.

In the most recent spectrum auction, O2 claimed all the available 2.3 GHz spectrum to enhance its 4G offering. This spectrum has already been put to use, while most recently O2 suggested it was going to improve connectivity in 339 rural communities throughout the UK. The business is investing in its network, with the financial results indicating O2 spent £192 million on CAPEX over the quarter, which works out at roughly 12.5% of total revenues. This is not the highest around, but it is a healthy number.

O2 is the first of the UK MNOs to release its financial results for the third quarter, so there isn’t a fair comparison to make at the moment. However, 7.9% growth is going to be a very tough number to beat. Perhaps there is something in this ‘do what you know how to do’ mentality from O2.

O2 commits to plugging 339 farmer Johns into the digital economy

O2 has announced it will start pumping enhanced 4G into some of most notorious not-spots throughout the UK, with 339 communities set to receive the connectivity boost.

While the digital divide is clearly still present across the UK, it does seem O2 is attempting to make use of 4G spectrum acquired in the last auction to counter the imbalance. The last 12 months has certainly seen O2 up its game on the connectivity front, Ofcom confirmed O2 had delivered against its commitment to provide 98% indoor 4G coverage and 90% geographical coverage across the UK earlier this year, and this appears to be a continuation of the positive work. O2 has stated in intends to improve the 4G experience for an additional 339 communities of more than 100 people across the UK by the end of the year.

“We know mobile has the power to make a real, positive difference to people’s lives and businesses in rural communities across Britain,” said O2 UK COO Derek McManus. “That’s why we’re proud to be investing in 4G connectivity for more than 330 rural areas by the end of this year. Technology never stands still, which is why we are always looking for the right partners and investing in our future network. Whether trialling 5G to support a future-proof, mobile Britain, or ensuring the remotest parts of rural Britain can connect to 4G, for O2, this is about continuing to invest in all areas – not one at the cost of the other.”

“4G coverage is improving all the time, but there’s more to do, particularly in rural areas,” said Digital Minister Margot James. “We’ve already reformed planning laws to make it easier and cheaper to install and upgrade digital infrastructure, and it’s great to see O2 and the rest of industry responding to ensure more people in rural Britain can share the brilliant benefits of 4G connectivity.”

Thanks partly to an enhanced mobile experience, O2 has pointed to a report from Development Economics which suggests tourism, transport and manufacturing segments could receive a financial boost with improved connectivity. Perhaps this is one of the most notorious statistics associated with the digital divide, but Development Economics predicts connectivity parity could add as much as £141 million a year to the 14,000 rural businesses who are missing out on the full digital experience.

Although this is a positive step forward, let’s not forget O2 has a lot of catching up to do, it certainly isn’t uncommon to see the brand slumping at the bottom of the mobile performance rankings. Opensignal’s most recent report assessing the performance of the four UK MNOs had O2 sat in last place for all categories aside from latency (3G and 4G) and availability, where it was second behind EE. Back in August, Rootmetrics also had O2 at the bottom of the pile for almost every category.

The performance of the network is certainly a dent in the O2 pride, but it has still managed to claim top-spot in the market share leagues. Although MNOs should stride towards creating the best possible experience for customers, O2’s top and bottom standings demonstrate buying decisions are more than performance orientated. The big differentiator between O2 and rest of the UK MNOs is its loyalty programme, Priority, which does appear to be paying dividends, while Giffgaff is still proving a successful venture to attract a new SIM-only audience. Such is the success of Giffgaff over the last few years, Three has creating its own version in Smartie, while Vodafone has launched Voxi.

That said, building the customer experience in rural areas of the UK will only add to the success of the telco, creating a more interesting proposition for customers which might have ignored the brand in the past. O2 has been swimming against the tide when it comes to convergence trends, choosing to focus exclusively on mobile, a decision which is increasingly looking justified.

EE holds onto Opensignal MNO crown

EE has held onto its position as the best performing UK MNO according to the latest figures from Opensignal.

For 4G download performance, EE maintained its leadership position with average download speeds of 29 Mbps between June and August, while it also led in upload speed, latency and availability. This is not to say there weren’t improvements elsewhere, Vodafone grew its average 4G download to 21.9 Mbps, though Three’s dropped with the telco slipping down to third place in the performance rankings.

4G might not have been a fruitful playground for Three, but it did steal the top-spot for 3G speeds off EE. With average speeds of 7.8 Mbps it edged just ahead of EE at 7.2 Mbps, though this will come as little comfort as telcos increasingly look to re-farm 3G spectrum to bolster 4G performance.

Interestingly enough, O2 is still maintaining its position as the leading telco in terms of market share, despite a damning review of the telco from Opensignal. O2 sat in last place for all categories aside from latency (3G and 4G) and availability, where it was second behind EE. O2 might arguably have the weakest network in the UK, the power of promotions seems to counter this position. The Priority loyalty programme is perhaps proving its worth in gold here.

While many will preach the benefits of having the best network, these figures show it’s not always about being the fastest.

Opensignal Awards

Three and O2 put positive spin on sh*t connectivity

Three and O2 have signed a deal with SSE Enterprise which will enable the pair to access its fibre ring, part of which is located in the Thames Water waste water network, to improve connectivity backhaul capabilities.

With 5G on the horizon, and demands for improved 4G experience, partnerships like this will be key to not only improve backhaul but also enable further 4G and 5G deployment by connecting cell sites and masts. Robust aggregation of fronthaul and backhaul access is necessary in order to provide greater resiliency, increase capacity and reduce latency. In other words, fibre is king if you want to meet the demands of the data-craving consumers.

Just to put things in perspective, UK data usage is set to grow thirteen-fold between 2017 and 2025 according to data from Ofcom, with the first 5G offerings set to hit the market during 2019. To meet this demand, 5G is key, enhanced 4G experience is key and backhaul is key. Fibre rules the roost.

“Networks will fundamentally underpin the UK’s digital economy and will be essential to 5G services,” said Colin Sempill, MD of SSE Enterprise Telecoms. “With this high capacity core in the London sewers, Three UK and O2 are tapping into our unique, diverse connectivity and putting their networks in a strong position to trial 5G offerings, while enhancing existing services for their customers.”

“New and innovative models are essential to improving the customer experience of mobile networks by increasing the availability of dark fibre for mobile backhaul and driving competition in the market,” said Dave Dyson, CEO of Three. “Our partnership with SSE Enterprise Telecoms and O2 is one of the first examples of using existing infrastructure to improve connectivity in an urban area.”

“This kind of agreement is essential to allow for continued investment and improvement of services for our customers,” said Brendan O’Reilly, CTO at O2. “This partnership is a great example of SSE Enterprise Telecoms, Three UK and O2 coming together in a collaborative and innovative way to address the growing challenge and pressure of obtaining access to fibre for mobile backhaul in the UK.”

SSE has been running some interesting projects to improve the speed and reduce the cost in terms of laying fibre over the last couple of months. In this example, SSE is licensed to lay fibre optic cables throughout Thames Water’s waste water network which it claims can reduce network deployment costs by 60% and speed up deployment by up to ten times. As the sewers can be as deep as 10 metres, laying the fibre in this way can decrease accidental fibre breaks as the traditional means see the cables laid only 12 inches below the surface. The waste water network is also geographically very wide-spread, it is a creative solution to the challenge of laying fibre more efficiently, even if it is a bit of a smelly one.

The agreement with Three and O2 will see approximately 100 points of connectivity exit from this central London sewer network via two BT Exchanges. By partnering with SSE Enterprise Telecoms, Three and O2 can operate their own Central London Area (CLA) network, while also accessing spare fibre ducts for future initiatives in London.

The last couple of months have seen SSE ink numerous deals with the telcos, including a separate partnership with Three where it has begun facilitating fibre optic connections for the telcos 20 core data centres. Last October, SSE also won a competitive tender from advanced fibre broadband specialists Grain to deliver network connectivity to Countesswells, a new £800 million development in Aberdeen.

Ronan Dunne said to be in the running for the BT CEO gig

Current Verizon exec and former O2 UK boss Ronan Dunne is reported to be one of the people BT is considering to replace Gavin Patterson.

The rumour comes courtesy of the Telegraph, which has sources that claim Dunne was recently over here to speak to BT about the opportunity. That’s about it as far as the Telegraph story goes – no comment from either Dunne or BT and it could just be blind speculation. But it is also plausible as Dunne has a lot of relevant experience and could be keen on the opportunity having missed out on the top job at Verizon and an apparent sense of unfinished business in the UK.

Current BT CEO Gavin Patterson decided to throw in the towel earlier this year following a bunch of negative events afflicting BT under his tenure. It looks like a pretty exasperating gig, not least due to the tightrope the former state monopoly has to walk with regulators. Dunne’s move to Verizon seemed to be prompted by his own negative regulatory experiences following the blocking of O2’s merger with Three UK, but maybe a couple of years away has renewed his appetite for the fight.

Among the other frontrunners for the top job at BT are current consumer boss Marc Allera and various other BT senior execs as well as anyone else a headhunter might find when the Goole ‘UK telecoms CEO’. Informa’s Stephen Carter has apparently distanced himself from the position without entirely ruling it out and they could just stick the head of another utility in if they wanted to play safe.

We’re not convinced by the convergence hype – O2 CEO

Despite almost everyone in the industry clamouring to climb the convergence mountain, O2 still remains unconvinced by the rewards, choosing instead to double-down on the mobile connectivity mission.

Speaking during a briefing ahead of its first half results, Telefonica UK CEO Mark Evans set out the mission very clearly; O2 is the leader in the UK mobile market, and it doesn’t plan to waver from than commitment any time soon. The customer is expecting greater reliability and performance, distractions is not what the business needs.

“Customers will curate content which is relevant to them,” said Evans.

Like Orange in France and T-Mobile US on the other side of the pond, the team’s number one objective to provide a connectivity experience which meets the expectations of the consumer. This does not mean its subscribers will struggle to access content, just that O2 is allowing those with expertise to focus on those areas. O2 will aim to reduce the price of tariffs (its Family Plan is a good example), improve 4G coverage across the country (the recent spectrum auction demonstrates this) and forge partnerships to offer the consumer choice (Netflix is a major win, and available for free to subscribers on certain tariffs).

The message seems to be empower the user through connectivity, creating room to allow for the difference in taste.

Another aspect of this strategy is the Priority pillar. Again, the team are offering value to the customer through partnerships, not getting involved in the messy business of owning diversification. 3.1 million Priority offers were accepted, while more than 18 million entries were made into the prize draw over the first six months of 2018. Again, it is a simple idea; offer value to the customer through breadth, while allowing the team to focus on the core business of connectivity.

It’s a refreshing approach to business, and perhaps explains why O2 is claiming the top-spot in the market share rankings. Including MVNO agreements, 32.1 million customers are now making use of the Telefonica UK network, while O2 currently claims 34% of the UK mobile market, according to the Ovum WCIS.

Looking at the financials for the first half, total revenues hit £2.836 billion, a year-on-year increase of 4.2%, while Operating income before depreciation and amortization (OIBDA), up 7.2% in comparison to the same period of 2017. Evans boasted of eight consecutive quarters of growth, while churn was down to 1%; the numbers are certainly heading in the right direction. CAPEX stood at £351 million, or 12.3% of total revenues, which is a bit down on the industry’s big spenders, but not the end of the world.

The issue here remains growth. As the leader in the market, substantial increases in subscriber numbers would not be a reasonable target. For Evans, the focus is about keeping current subscribers happy, while targeting marginal gains each quarter in market share. Growth will come in the enterprise business unit, where Telefonica is a challenger as it stands, and 5G will play a major role.

“5G is the most powerful opportunity to strengthen the economy, enrich lives and outperform the global economy,” said COO Derek McManus. “5G will have a bigger impact than any other technology introduced since electricity.”

Of course, 4G will not be forgotten, the team wrote a cheque for more than £523 million to bolster its 4G coverage, though the acquired spectrum will forge the foundations of the 5G push. While a minor player, developments for in the much-hyped 5G world will be the opportunity for O2 to push its case in the enterprise market. An agreement announcement back in April with Arqiva to deploy 300 5G-ready small cell sites across London will certainly help. These sites will be up and running in the second half of 2019.

As part of this drive, McManus said the team has written to every CEO of the FTSE 100 to invite the businesses to participate in O2’s 5G Testbed trials. The aim here is to create an understanding of the sheer breadth of use cases in across the UK, but also the 130-odd countries which the FTSE 100 has a presence in. 2020 has been targeted as the launch date for 5G services, with O2 aiming to focus on how the standard can improve efficiencies in supply chains and production processes.

No-one really knows how 5G will work just yet, but the testbeds will offer insight. McManus, who has been with Telefonica through the introduction of 3G and 4G, noted that each evolution brought about new operating models and opportunities; learning without doing is impossible, and much will be learnt over the years following deployment of 5G.

O2 is the current leader in the UK mobile market, and with a sustained focus on its core business, waving away diversification distractions, it certainly looks in a promising position heading into the 5G era.

UK telcos not meeting demands of Brits

New research from RootMetrics points the finger at UK telcos for not meeting the expectations of the demanding consumer, claiming only 53% of Brits are actually happy with their mobile service.

Despite consistent belief and self-praise from the telcos, research pieces like this are becoming more common. Telcos argue performance and net promoter scores are constantly on the rise, while value added services are becoming a game changer, but perhaps this is evidence the telcos are fulfilling the core promise to the consumer; connectivity.

EE and Three have the highest levels of satisfaction with speeds, getting the thumbs up from 57% and 58% of respondents respectively, while O2 ranked the worst at 51%. These numbers aren’t necessarily the worst in the world, but there is almost certainly a considerable amount of room for improvement.

“5G will flush everything out and become a ubiquitous technology for connectivity in metro areas – no more Wi-Fi,” said Kevin Hasley, Head of Product at RootMetrics. “At the moment operators in the UK are involved in a bit of a cat and mouse game with each other and government about who will invest first in the infrastructure. Clearly mobile operators need to plan their capital expenditure carefully, but 5G will be a key battleground to winning subscribers in the near future and there is first mover advantage here.”

While data demands are intensifying, perhaps it is simply because the users have been offered the dream of something better. Telcos have been promising the absolute connectivity experience, anywhere, at any time, but realistically, living up to this expectation was always going to be a tall order. These promises of perfection have seemingly only set the telcos up to fail, and in turn, intensify the demand for 5G.

Looking at the business case for 5G, this is where the UK telcos (and Europe in general) are being a bit coy. Unlike counterparts in the US and Asia, UK telcos seem to resistant to the idea of aggressively rolling out 5G networks. There will of course be multiple reasons for this, from societal, to economic and political, but that does not change the suspicion that Europe will be the last to the connected bonanza. However, there might just be a business case in the consumer world after all.

According to the data, while price remains the defining factor when choosing a provider, 79% of respondents would be willing to pay marginally more if it could provide faster connectivity speed and higher reliability. O2 customers represented the most inclined, 17% to pay £10 or more for a better service, perhaps representing the frustrations of the customers who have been receiving apparent poor service. As with everything consumer related, you have to take it with a pinch of salt.

“People say they would pay more for better connectivity and that option is 100 percent available to them at the time of renewal, but many then make the decision on price alone,” said Hasley. “It is a false economy and people end up biting their nose to spite their face. In most areas of life we make decisions based on what we think is value for money, not just purely price motivated ones. Many among us have a tendency to be penny wise and pound foolish.”

Quarterlies round-up; Telefonica UK, Orange and AT&T

It’s that time again for us to line up the telcos and judge. Here we’ll be having a look at how Telefonica UK, Orange and AT&T measured up over the last three months.

O2 spending needs to continue to consolidate top spot

Telefonica’s UK business continued writing cheques through the last quarter to correct a pretty poor record to date, which does seem to be paying off. Aside from capturing the top-spot when it comes to market share, total revenues increased 2.9% year-on-year to $1.4 billion, while service revenues were up 1.2%.

“We have delivered another solid quarter driven by our relentless focus on customers,” said Patricia Cobian CFO for Telefónica UK. “We are growing top and bottom line in a very competitive market while maintaining the highest levels of customer loyalty and satisfaction in our sector. Our newly acquired mobile spectrum allows us to further strengthen our award winning network, enhancing our connectivity for our customers while boosting the economy and laying the foundations for 5G in Britain.”

Low customer churn is key for a successful telco, and to lower churn a positive customer experience is needed. O2 has regularly lagged at the bottom of the performance rankings in the UK, though investing £523.6 million to obtain 40MHz of immediately useable 4G spectrum (2.3GHz) and 40MHz of 3.4GHz spectrum for 5G certainly puts it in a promising position. Alongside the earnings, O2 has also announced it will deploy the new 4G spectrum at over 1,000 sites across the UK by the end of 2018, with Leeds and Nottingham on the list. These sites will add to the 60 sites in London already using the new airwaves, after the spectrum was activated within 24 hours of Ofcom making them available for use.

The bells and whistles O2 offers through its priority moments proposition will only get the telco so far; to be relevant in the future experience has to be at the highest levels. CAPEX over the last quarter was £161 million, which at 8.6% of total revenues is pretty low compared to some. The telcos who are in the best position moving forwards are the ones who are spending big on improving network performance, the Orange group spent 15.2% of revenues this quarter, while even Three, notorious for being cheap, spent 19.1% during Q1.

Customers are not very forgiving. O2 has been making some positive steps forward, but unless it continues to correct network inadequacies it will lose the number one spot soon enough.

Convergence leads the way for revenue boost at Orange

The Orange group has reported a 2% year-on-year boost for total revenues, taking the total for the quarter to €10.1 billion, with the management team pointing towards the convergence as the big winner.

“In this first quarter we successfully built on the positive momentum from 2017, with growth in revenues of 2.0%, adjusted EBITDA growth of 3.8% and a strong commercial performance across all our geographies,” said CEO Stephane Richard.

“In this pivotal time for the Group, these strong results continue to demonstrate the relevance of our strategy and in particular, our efforts to differentiate ourselves through excellent networks and customer relations. Over 90% of the population across our European countries now have access to 4G, this includes 97% coverage in France. Having maintained a steady rhythm of deployment, we remain the European leader in fibre, bringing connectivity to 27.7 million households.”

Convergence is king here, with 10,541 million customers as of 31 March, a 10.4% year-on-year with revenues tied to convergent customers up 14.1% in the first quarter. Convergence is a golden egg sought by almost every telco on the planet, but few are making it work as effectively as Orange.

Looking at total subscriber numbers, the group is looking in a very healthy position. 4G subscribers now stand at 48 million customers, up 45% year-on-year with an additional 15 million customers, while fibre brought in an additional 130,000 net sales in France, 169,000 in Spain and 34,000 in Poland. Unlike other telcos across the continent, BT for example, the focus on improving customer experience as opposed to shiny content offerings seems to be paying off considerably.

Media business is growing, but AT&T ambitions hang in balance

The AT&T wireless business is a monster, but the future has been pegged on entertainment. DirecTV Now is progressing well, with an additional 312,000 subscribers this quarter, but the battle with the Department of Justice could decide fortunes here.

“We’re off to a good start in 2018, both in growing our customer base and in building the world’s premier gigabit network,” said Randall Stephenson, AT&T CEO. “Our investment in customer growth and our integrated service offerings helped drive solid first-quarter subscriber gains across our wireless, video and broadband businesses.”

Total revenues for the quarter were $38 billion, down 3.4% year-on-year, missing analyst expectations of $39.3 billion, but most of this news has seemingly taken a backseat in the last couple of weeks. If you look at the rest of the business, the company is doing okay and does seem to be progressing towards the 5G world at a steady pace, however the court case has been hogging the headlines.

To compete against the tech giants, who are only leaving crumbs of profits to fall down to the communications providers at the bottom of the totem pole, AT&T needs to enhance its media offering. We’re not necessarily sure content is going to be the silver bullet to save telcos, look at the disaster BT got itself in with its sports ventures, but for those who have chosen the content path it can’t be done half-heartedly; winning the case against the Department of Justice to merge with Time Warner is critically important.

The slowdown in profitability in the postpaid space, as well as increased competition, make the idea of bundling content services an attractive prospect. AT&T lost 22,000 of the attractive postpaid customers, which was offset by the acquisition of prepaid subscribers, executives will have their eye on reversing this trend with bundling offerings. The signs seems to be positive for AT&T in the court case, however it is far too early to make predictions.

Vodafone forces Three to drop an extra £13 million for its preferred 3.4 GHz spectrum

Ofcom has announced the final outcome of the UK 5G spectrum auction, following the assignment stage, and Three had to pay a premium to get exactly what it wanted.

This stage wasn’t a free-for-all, instead there were two distinct blocks of spectrum either side of Three’s UK Broadband legacy and it was somehow determined that only two operators could bid on each block. It was probably down to the size of each block: the lower one being 70 MHz wide and the higher one 80 MHz meaning Three (which won 20 MHz) and Vodafone (which won 50 MHz) had to bid against each other for their place in the lower block.

As you can see from the Ofcom diagram below, Three had to grab the part of that lower block that was adjacent to its lower 20 MHz UK Broadband spectrum to create a contiguous chunk that is much more useful for things like carrier aggregation. Being allocated a 3410-3430 chunk would have been significantly less useful.

Ofcom 5G spectrum allocation chart

Vodafone had no such concerns, having no other spectrum anywhere near this band, so it presumably wasn’t bothered about what it was allocated. However, as you can see in the table summarising the results of the allocation auction below, Three ended up spending £13 million for its preferred chunk – far more than anyone else.

Ofcom 5G spectrum allocation table

The mechanics of the process seem to be that only the winner of each mini auction ended up paying, but EE only had to drop a mil to outbid O2 for its spot in the high section. We understand this was to do with potential interference with the 1800 MHz band, of which EE is far more reliant upon than any of its competitors.

This implies the bidding was a lot more intense between Three and Vodafone, despite the latter not really caring about the outcome. The only explanation we can think of is that Vodafone drove up the price for a laugh, knowing Three couldn’t afford to lose it, which is quite amusing.

Pouring further salt in Three’s wounds will be the recollection that BT/EE had called for the matter of allocation to be resolved in advance back when it and Three were still contesting the auction process last year. BT/EE was derided by Ofcom and Vodafone for potentially delaying the auction, but had it been accommodated Three could be £13 mil better off today. Gutted.