Hutchison Threatens To Close Down Three Over 4G Auction

Hutchison Whampoa has threatened to pull the plug on its mobile network Three in the UK, if it is not guaranteed spectrum in the forthcoming auction for 4G spectrum, reports The Sunday Times.

The company, which is described as “Britain’s largest foreign investor” has previously said that Three would go out of business if it was unable to secure enough bandwidth.

Mexican standoff

Canning Fok, managing director of Hutchison, reportedly told Prime Minister David Cameron that it was ready to halt investment or even close down its mobile operations in the UK in a meeting at Downing Street last month.

The meeting, which was also attended by culture secretary Jeremy Hunt and minister Ed Vaizey, was apparently not unusual due to Hutchison Whampoa’s expanding portfolio of British businesses, which includes chemist Superdrug and ports such as Felixstowe.

Ofcom revealed in its proposals for the perpetually delayed auction of 4G spectrum that Three, the UK’s smallest mobile operator, would be the only network guaranteed bandwidth. However rivals such as Vodafone have disputed Three’s claims that its business would be unsustainable otherwise and that it would have plenty of opportunities to gain enough spectrum in the process, meaning it shouldn’t be entitled to cheap spectrum

It was previously believed that Everything Everywhere, the UK’s largest mobile network in terms of subscribers, would also be guaranteed bandwidth, but this is no longer the case. The operator has instead announced plans to create a 4G network on its existing spectrum, a move which has caused Three to threaten legal action, arguing that EE should not be allowed to launch it before the auction.

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