4G coverage targets thrown into doubt
Mobile coverage was just one part of the investment programme meant to make the UK the place to do business, from making a phone call in a busy city centre to being parked in a layby on a rural A-road. £150m was announced in October 2011 to fund better mobile coverage for almost 1 million people, then this was scaled back to just 60,000 people in the summer of 2012. The Financial Times is now highlighting further doubts about the project.
The worry we have is that problems with the project and worries that mobile operators have about the running costs (estimates of around £6m per year to service these hot spots) mean that the situation may be that providers are now looking for on-going subsidy, rather than just help with the capital costs of building masts and installing backhaul.
With an aim of improving coverage for just 60,000 of the population, this amounts to around £2,500 per person, which is many times larger than the £100-200 per property that fixed line broadband projects are attracting from central Government via the BDUK. With the 4G auction reserve price of £1.4bn and an expectation for bids of over £3bn the re-investment of just £150m suggests that the Government is happy to 'tax' the mobile industry and be seen to be doing something for areas with bad coverage, but nothing of the scale that will make a significant difference.