Matthew Howett, Principal Analyst, Regulation at Ovum comments:
“While the UK government’s once preferred solution of ’national roaming’ to deal with mobile not-spots sounded attractive to those with coverage issues, it was a messy solution that has fortunately been abandoned.
Instead, operators have agreed to work collectively to deliver improved geographical voice coverage (rather than population coverage), of 90% by 2017. The deal-maker? A re-evaluation of the ongoing spectrum license fees to reflect the value of the coverage target has become more onerous.
The cost, complexity, and side effects of national roaming made it such an unworkable fix that it really should never have made it into the list of possible options. While it works as a concept when you travel abroad, it wasn’t a solution to dealing with poor mobile coverage domestically. Aside from the cost, potential side effects include reduced battery life, and, for some customers, even losing data services altogether for prolonged periods. It also didn’t attempt to address poor data coverage, but only problems with 2G voice services.
As Ovum argued at the start of the consultation, what needed to happen was for the mobile operators to work collectively with government to come up with an agreeable fix that addressed not only poor voice coverage, but also data too. Thankfully common sense has prevailed and this is what consumers are set to benefit from. The operators were always themselves in the best position to improve coverage, something which had been the case given that mobile spectrum auctioned last year at 800MHz is particularly well suited to covering large and more rural areas, and they are only just starting to make use of those airwaves. The eventual solution had to continue to incentivise operators to invest in rolling out networks, which is already happening at a far quicker pace that anticipated just a few years ago, and with considerable investment.
The annual spectrum licence fees were always likely to be used as a bargaining chip. While not ever directly linked to the not-spots consultation, it has been an ongoing battle between government, regulator, and industry ever since the original 2G spectrum was liberalised for other uses back in 2009 and the fees needed to be readjusted to reflect the new value of that spectrum. While Ofcom had already gone back on the planned fee hike, its hands were tied in respect to bringing them down any further. Now it looks set for the government to direct Ofcom to reconsider (hopefully for the last time), the value of that spectrum now that it comes with a higher coverage burden.”
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