The "digital dividend" spectrum that will be central to launch of new 4G mobile phone networks will not now be allocated until the first quarter of next year, Communications Minister Amy Adams says.

The spectrum - in the prime 700MHz band - will only become available to telcos once analogue television broadcasts have been completely turned off nationwide in November 2013. 

However, the Government has said allocating the spectrum before that would give telcos more time to plan their investments in 4G, so they could hit the ground running.

The spectrum should fetch hundreds of millions of dollars, assuming it sells for anything close to the going international rate at auction.

Adams said in April that she expected to send a paper to Cabinet setting out how the spectrum would be allocated in "the next few months" and had previously indicated the process could be wrapped up this year.

An allocation in the first quarter of 2013 would still allow "time for business and network planning, so services can be deployed as quickly as possible once spectrum is available", she said.

But an industry source questioned whether the Government could meet even the March deadline, saying the Australian government appeared to be "well ahead" in its planning process, even though it does not plan to auction its digital dividend spectrum until April. Its spectrum will not be available to telcos until 2015, however, 13 months later than in New Zealand.

Maori have made a Waitangi Tribunal claim for the spectrum and the Government has not yet indicated what, if any, concessions it might make in relation to that claim.

British regulator Ofcom had also originally expected to allocate that country's digital dividend spectrum this year but announced last month that it would not accept bids until early next year. British newspapers said its auction was tipped to raise £4 billion ($7.7 billion).

2degrees spokeswoman Charlene White said any delay to the New Zealand allocation process would allow "more time for consultation to ensure that it is done right".

"An auction is not necessarily the right approach for New Zealand," she said.

In contrast, Vodafone has argued for the spectrum to be allocated as quickly as practical. Both it and Telecom could launch some 4G services ahead of the analogue switch-off, using higher-frequency radio spectrum. 

- © Fairfax NZ News