The government auction of licences to operate fixed wireless broadband services has failed to attract established carriers to fill the UK's broadband gaps.

Applications to bid for licences to provide 15 regions with broadband via the 3.4GHz radio frequency waveband closed last week. But the list of 26 applicants contains few established telecoms names, while the lenient terms and conditions of the auction mean successful bidders need never actually roll out any services.

"Only two applicants look capable of generating active services," said Michael Philpott of analyst company Ovum.

Successful bidders are not required to submit rollout plans or bankers' guarantees for the £100,000 to £300,000 licence fees, and could hold licences for up to 15 years.

A spokeswoman for the UK Radiocommunication's Agency (RA) said background checks would be made, but she seemed unaware that 15 of the applicants all share the same address, that of company formation agent Jordans, and were set up between 24 March and 31 March this year.

"We are responsible for freeing the spectrum, not policing what people do with it once they've bought it," she said.

The government estimates that fixed wireless access could account for 18 percent of broadband use in the UK by 2007. Wireless access would deliver 2Mbit/s connections in areas where broadband DSL and cable services are unavailable.

But the 3.4GHz auctions look unlikely to deliver on this promise. Pierre Danon, chief executive of BT Retail, called the auction "stupid", and said BT would not participate.

Have your say: reply to IT Week