4G roll-out to boost State’s coffers by €855m

The exchequer is to receive an €855m boost — half of which will be realised by the end of this year — from the country’s leading telecommunications operators upgrading their networks to 4G (fourth generation) standards.

Yesterday’s multiband-spectrum auction — carried out by industry regulator ComReg — saw Vodafone, Telefónica/O2, Eircom, and 3 spend millions on enhancing their capabilities through the effective renting of new bandwidth that will allow them to offer improved and faster mobile phone and broadband services.

While industry leader Vodafone invested the most at nearly €161m on new ‘spectrum rights’ (O2 spent nearly €125m, Eircom €145m, and 3 over €51m), each player said they will now be in a position to roll out 4G services next year, giving customers connection speeds roughly four times faster than existing 3G services.

The auction awarded new bandwidth licences in the former GSM/2G-only bands and in the 800 megahertz ‘digital dividend’ band, which became available last month following the analogue/digital switchover.

About €450m of the total spend will go to the exchequer this year with the remainder coming on a phased basis over the life-span of the new licences, which will expire in 2030.

“The proceeds of the auction are greater than many people expected and are a statement of confidence in the economy,” Communications Minister Pat Rabbitte said.

He said the auction marked a milestone in helping to accelerate the roll-out of high-speed broadband services in Ireland.

ComReg chairman Alex Chisholm called the auction “one of the most significant pieces of work undertaken” by the regulator.

“It is a vital step that promotes competition and allows the next generation of advanced mobile services to be made available to Irish consumers and businesses from next year,” he added.

Telefónica/O2 said it will be investing a further €200m on rolling out its 4G service next year, while Eircom said its auction spend forms a core part of a €1.3bn investment plan.