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Hutchison 3G might lose 2G roaming agreement with O2

May 17, 2003

UK's telecom regulator Oftel has published a consultation document on whether the current requirement on O2 and Vodafone to negotiate an agreement with 3G new entrant operator Hutchison 3G (3) to allow customers of 3 to roam over their 2G network should continue.

Under the new EC rules, all licences will be revoked on the 25 July 2003 which means the current obligation on O2 and Vodafone to offer roaming will fall away.

The 3G licences of O2 and Vodafone granted under the 3G mobile spectrum auction include a condition that requires them to negotiate a national roaming agreement with Hutchison 3G (3), a new entrant mobile network operator, and provides a backstop for Oftel to ensure at least one agreement is reached. The national roaming condition was agreed voluntarily by 02 and Vodafone.

The individual 3G licences condition of O2 and Vodafone will cease on the 25 July 2003 and the current national roaming agreement with 3 will therefore automatically fall away.

Because of the current poor state of 3's 3G network coverage, Oftel therefore is considering whether or not the conditions requiring a national roaming condition still exist and whether an agreement should be put in place or whether it should be allowed to fall away.

There are arguments for allowing the condition to fall away. It would reduce the regulatory burden on 02 and Vodafone. However, retaining the requirement to offer national roaming has significant advantages. It offers a regulatory backstop that helps to ensure sustainable market entry by the new 3G entrant, to the benefit of consumers. Oftel is of the view that the continued and sustainable increase in competition in the mobile market, which was an objective of the auction of spectrum for 3G, continues to be a valid objective.

The Director-General of Telecommunications's initial view therefore is that national roaming should continue to be available to Three.

 


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