Auction for 'digital dividend'

Whitehaven in Cumbria was the first UK town to switch off analogue TV

A multi-billion pound auction of airwaves for a new wave of digital services has been launched by Ofcom.

More digital TV channels and ultra-fast wireless broadband could be rolled out over the next decade as radio spectrum is freed up by the digital switchover.

The regulator has said that the market will decide how the spectrum is used with an open auction.

The BBC, Channel 4 and ITV had pressed for ring-fenced space for high definition TV over Freeview.

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Ofcom chief executive Ed Richards said the decision to opt for a "market-led approach" was "one of the most important decisions we have ever made".

He said the auction, which will start in 2009, would lead to a "digital dividend" for the UK.

The regulator has packaged the available spectrum into key uses:

*National digital terrestrial TV in high or standard definition
*Cognitive radio - a new wireless technology which can deliver broadband
*High-speed mobile broadband and mobile TV
*Local television - 25 new local TV stations across the UK

The regulator has said that the suggested packaged areas did not necessarily mean the spectrum had to be used exclusively for those purposes.

Q&A: Digital television

As part of switchover, much of so-called interleaved spectrum - which is "white space" between television transmitters to prevent interference - will be dedicated for use by services like wireless microphones.

There had been concern that if spectrum was not reserved for this use, events like the Olympics in 2012 and work by TV broadcasters would be affected because they would not be able to use the microphones.

A consortium, known as HD For All, had lobbied Ofcom to reserve freed-up spectrum for high definition TV services over Freeview.

The group, made up of UK terrestrial broadcasters, as well as Sony, Samsung and the Dixons retail group, felt that the UK could become a two-tier TV nation, with those prepared to pay having access to better quality TV pictures.

But Ofcom said HD pictures could be delivered over digital terrestrial TV without the need for allocated spectrum.

It said advances in digital compression technology and a new transmission standard, called DVB-T2, could deliver HD channels by the end of 2009.

Ofcom said HD television remained a "premium" service.

HD For All has now said it supports Ofcom's position and has agreed to deliver HD on Freview by 2012.