The government office that regulates telecommunication services in Britain is proposing an auction of the L-band spectrum currently reserved by global and European regulators for satellite services, a move that could undermine any future satellite-radio venture in Europe and set an example for other nations that refuse to accept regional or global frequency allocations.

The British Office of Communications (Ofcom) has set a June 9 deadline to hear final appeals about the proposed auction, which would occur as soon as possible, which likely means in early 2007.

In publishing its auction proposal Oct. 31 and April 3, Ofcom waived aside protests by satellite industry representatives, including several companies that have no interest in the spectrum in question but view the Ofcom move as a dangerous precedent.

It also dismissed concerns expressed informally by other European governments. One French government official said Ofcom’s proposal ultimately will benefit no one.

“This is typical of Ofcom’s view that international harmonization is more of a constraint than anything else,” the French government official said. “It’s a good example of a decision that is supposedly based on technology neutrality when in fact it is placing satellites at a disadvantage.”

The official said the mere fact of the Ofcom proposal could make it more difficult for prospective European satellite-radio systems to raise the necessary capital by creating doubts about the spectrum’s availability. At the same time, the official said, British terrestrial services bidding for the satellite spectrum will be forced to design systems that do not interfere with satellite networks in neighboring nations — making the terrestrial service all but useless. “You can call this a lose-lose scenario,” the official said.

London-based Inmarsat, a provider of global mobile satellite services, is one company that protested to Ofcom despite the fact that Inmarsat has no operations in the slices of L-band spectrum Ofcom wants to auction.

Like other satellite companies, Inmarsat said that if Britain decides not to adopt spectrum set-asides agreed to by European and global regulators, other nations might follow suit in other areas of spectrum similarly reserved for satellite services.

“If individual countries choose to hold auctions or some other competitive contest to determine use of spectrum, the necessary regulatory certainty cannot be achieved,” Inmarsat said in a filing to Ofcom. “For the development and introduction of new satellite operations, it is necessary to have a high expectation of access to spectrum in the target countries.”

Ofcom proposes to auction off, in slices, 40 megahertz of L-band located between 1452 and 1492 megahertz.

The upper 12.5 megahertz of that spectrum, between 1479.5 and 1492 megahertz, has been reserved by the United Nations-affiliated International Telecommunication Union (ITU) and by the European Conference of Postal and Telecommunications Administrations for satellite services, particularly digital satellite radio.

Britain has not agreed to this allocation, meaning it is free to do what it likes with the spectrum so long as it respects the allocations made by other nations. Because spectrum use does not always respect national boundaries, Britain would need to assure that if a terrestrial user won the auction for this 12.5 megahertz, its future operations do not interfere with a satellite service in, for example, Ireland or France.

That restriction may reduce the value of this slice of spectrum to potential bidders, who would be obliged to reduce their signal strength near British borders to avoid polluting a satellite service in neighboring countries.

“At least five such satellite networks are notified or pending notification [to ITU regulators], resulting in material constraints on terrestrial use in this sub-band across much of the U.K,” Ofcom says in its auction announcement.

To account for this, Ofcom proposes to auction the 12.5 megahertz in question as a single slice rather than dividing it into smaller pieces, as it proposes to do with the rest of the 40 megahertz to be auctioned .

When Ofcom first indicated in mid-2005 that it may want to auction the spectrum, it invited comments from interested parties.

Among those filing formal protests were the European Satellite Operators Association , which represents European satellite-fleet owners; the Global VSAT (Very Small Aperture Terminals) Forum, which promotes the use of satellite networks; Alcatel of Paris, which is weighing a satellite-radio project; Inmarsat; and WorldSpace of the United States, which operates a satellite-radio service that reaches Europe and plans a wider service with a new satellite that would cover all of Britain.

Silver Spring, Md.-based WorldSpace, whose AfriStar satellite covers Africa and much of Europe, recently received U.S. regulatory approval to launch a successor satellite that would cover almost all European territory. The company said the Ofcom auction, if it results in satellite spectrum being taken over by terrestrial services, “would severely and negatively impact the potential development of [satellite radio] services in the U.K., and potentially elsewhere in Europe to the detriment of consumers.”

In its response, Ofcom concedes that satellite services are particularly effective in assuring telecommunications links to rural areas. But it has concluded that “restricting the use of the spectrum to satellite radio would not benefit consumers.”

Some prospective terrestrial users argue that since no European satellite radio initiative has materialized despite years of access to the spectrum, the frequencies should be freed for other uses.

“All of the spectrum between 1452 and 1492 MHz will be awarded at the same time and as soon as practically possible,” Ofcom says. “This implies simultaneous award of the top 12.5 MHz and the lower 27.5 MHz of this spectrum.”

An official with one company whose business would be affected by the Ofcom auction said a group of satellite companies plans to file a fresh protest before the June 9 deadline.