Following completion of the UK 4G spectrum award, Ofcom sought to revise the annual licence fees (ALFs) for licences in the 900 MHz and 1800 MHz bands to better reflect the value of the spectrum. To support Ofcom with determining the appropriate level at which to set the ALFs, DotEcon prepared a report examining evidence on the value of the relevant bands in other jurisdictions.
In particular, DotEcon used comparable spectrum prices reached in auctions across other countries, renewals fees for licences and spectrum values realised in secondary trading to estimate value ranges.
We used a similar methodology to advise Ofcom in the design and implementation of a methodology to calculate band-specific proxy prices for the 800MHz and 2.6GHz bands from the package prices of the 4G auction. Our implementation report comparing the linear reference price methodology (LRPM) and the addition spectrum methodology (ASM), and providing the price estimates resulting from their applications can be downloaded here.