UK gov't orders inquiry after broadband auction

Hard on the heels of the UK government's auction for broadband wireless licences, Patricia Hewitt, minister for small business and e-commerce, has called for an official inquiry into the auction process due to unsold licences and disappointing financial results.

          Hard on the heels of the UK government's auction for broadband wireless licences, which concluded this week, Patricia Hewitt, minister for small business and e-commerce, has called for an official inquiry into the auction process due to unsold licences and disappointing financial results.

          Only 16 of the 42 available licences for 28GHz BFWA (broadband fixed wireless access), allowing companies to deliver internet and multimedia services over the airwaves wirelessly, were auctioned.

          Furthermore, the £38.2 million ($US54.4 million) raised was far below the £1 billion the government had hoped to generate through the auction, according to a spokesman for the UK Department of Trade and Industry.

          "I have asked for a report on the outcome of the auction to help us plan for future spectrum allocations. It will examine also the scope for awarding licences in those regions where no licences were sold," Hewitt says..

          Of the 10 bidders taking part in the BFWA action, begun on November 10, six companies purchased licences. Those companies were Energis Local Access, Norweb Telecom, Faultbasic, Broadnet UK, Chorus Communication and Eircom NI.

          Three licences were being auctioned for each region in England as well as Scotland, Wales and Northern Ireland, with most of the sold licences covering large metropolitan areas, including greater London (three licences), greater Manchester (three), Northern Ireland (three) and the West Midlands (two), at the exclusion of rural areas, the government spokesman confirmed.

          The soft BFWA auction comes amid collusion probes by the Dutch and Italian governments after their third generation (3G) mobile phone license auctions, as well as lacklustre 3G auction results in Germany and Switzerland.

          The UK is planning additional auctions in 2001 for spectrum at 3.4GHz, 10GHz and 40GHz, the UK government says.

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