There's not much doubt as to who suffers most from Ofcom's decision to push out the start of the U.K.'s 2.6GHz auction process yet again. There are likely to be several contenders for the spectrum, but only one that can make a really big impact on the U.K. mobile broadband market: BT Group plc (NYSE: BT; London: BTA).

BT has the dubious distinction of being the only major incumbent telco in the western world that doesn't have a 2G or 3G license. It has had several shots at shoehorning other wireless technologies into competing with cellular. For those with long memories, there was CT2/Telepoint in the early 1990s, followed by dualmode DECT/GSM in 1998. Both crashed and burned.

More recently, BT has floundered on with dualmode "Fusion," combining a cellular MVNO proposition with in-building coverage based first on Bluetooth, now WiFi. BT Open Zone is competitive enough as a WiFI hotspot service, but nothing special compared with the WiFi coverage that many other cellular operators also offer as a complement to their 3G service. The most recent "Digital Cities" effort to deploy wide-area WiFi has failed to capture the imagination of consumers or investors, and is unlikely to take much more than a splinter of the U.K.'s mobile broadband revenue opportunity.

Over the last 20 years, watching BT try to take on the cellular networks with alternative wireless technologies has been a bit like watching the annual assault on the Wimbledon title by British tennis players. A lot of hope, PR, and bluster, followed by the inevitable demise at the hands of a more agile opponent with much better net coverage and a much more powerful service.

Hence the cruelty of this latest delay in the 2.6GHz auction. In WiMax, BT has at its disposal a technology with which it can finally give the 3G operators a genuine run for their money. Rolling out a nationwide WiMax network has been a key strategic objective of BT's for some time. The organization is all set to go. The WiMax infrastructure vendors are raring to go as well: The BT opportunity was likely a significant factor behind Alvarion Technologies Ltd. (Nasdaq: ALVR)'s OEM agreement with Nortel Networks Ltd. , for example. All that's needed now is a license at 2.6GHz, and it's a reasonable bet that BT will bid "whatever is necessary" whenever the auction is finally held.

While the additional delay is certainly cruel from BT's perspective, that doesn't mean it's unjustified. Of course, the 3G operators are filibustering; but there is also some substance to their filibustering. In particular, the cellular operators object that they can't accurately value the 2.6GHz spectrum until they have greater clarity on the future of their 900MHz GSM licences, and their rights to re-farm the 900MHz spectrum for W-CDMA or LTE (Long-Term Evolution).

As I showed in my recent Heavy Reading report, "3G Squeeze: GSM, LTE & the Future of W-CDMA," the real-world cost savings that can be achieved by a mature operator re-farming the 900MHz spectrum for W-CDMA – taking full account of operational costs to the operator on the ground – are quite a lot less in practice than in theory. And in that ongoing analysis by Ofcom and other industry players lies a key source of the delay in the auction and BT's continued isolation at the margins of the mobile broadband market.

If the parallels with the British tennis scene continue to hold, there are cheerier indicators for BT. Britain's latest hope, Andy Murray, came through a field of Federer, Nadal, and Djokovic to win the Cincinnati Masters last week-end. Afterwards he said, "I fought and just tried to stay calm and make sure I stuck to my game plan." Frustrated as the company must surely be, BT needs to do much the same.

— Patrick Donegan, Senior Analyst, Wireless, Heavy Reading