O2 claims 4G auction will cost £1bn and is illegal

Delays could be caused to the awaited 4G auction

4G has gone just a littel further away, with potential delays

O2 has said that the long-awaited auction of the new 4G mobile services is "illegal under EU law", alleging Ofcom is offering up to £1 billion of illegal state aid to its rivals.

Legal issues could mean that the auction could be delayed.

A spokesman for O2 said that parts of the current auction equated to “state aid and are therefore illegal under European Union law”.

They said: "The spectrum floors would distort the auction process, allowing all bidders, except Vodafone and O2, to potentially acquire spectrum at discounted prices." They suggested this would cost taxpayer's up to £1 billion.

Ofcom denied these statements and said: "We are fully aware of state aid rules and would not have made proposals that we considered illegal."

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Via: Guardian