Ofcom threatens action against O2 for failing to meet 3G rollout obligation

On 27 February 2008, the Office of Communications (Ofcom) announced that it has sent O2 a new deadline of the end of June 2008 to meet its obligation to roll out its 3G network in order to enable 3G services to be provided to at least 80% of the population (see Legal update, Ofcom publishes conclusions on compliance with 3G rollout obligations). The original deadline for meeting this roll out obligation was 31 December 2007. Ofcom confirms that the other four 3G licence holders (H3G, Orange, T-Mobile and Vodafone) have satisfied the obligation in relation to their networks. However, O2's coverage is only at 75.69%, resulting in a shortfall of about 2.5 million people. Ofcom has sent O2 a licence breach notice under the Wireless Telegraphy Act which sets the new deadline and states that if O2 fails to meet the 80% target by the end of June, Ofcom will shorten the term of O2's 3G licence by four months, which would be equivalent to a financial sanction of £40 million.
PLC Competition

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