Sarajevo 23rd – 25th March 2011

Brian Last Radio Regulatory Associates Ltd

United Kingdom

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The purpose of this short presentation is to briefly review recent developments in radio spectrum management. The presentation has been structured into three sections:

Setting recent spectrum management developments in context

The 2002 regulatory framework and key activities over the period 2004 – 2009

The 2009 revised regulatory framework and current activities

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Historically, spectrum management was characterised by an engineering-centric focus on preventing harmful interference between users of radio spectrum. Decisions on type of use, technology and services deployed were usually made by the government/regulator. This has been described, rather loosely, as a ‘Command and Control’ approach.

The pace of technological change, convergence and the growth in demand for suitable spectrum for, amongst others, mobile broadband services raised questions about whether a more flexible approach, based on a more economic-centric approach would be likely to lead to a more efficient and effective use of radio spectrum.

Noting that spectrum is a finite and limited resource, a growing number of administrations were attracted to the use of a more market- based approach to spectrum management .

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There are a number of different but related aspects to a market-based approach to spectrum management:

◦ Liberalisation (flexible use of spectrum)

◦ Secondary Trading (transfer of rights of use)

◦ Spectrum Pricing (a proxy for the market value of spectrum)

In addition to these key aspects, there is also a need to release ‘new’ spectrum into the market (and make tradable) and to encourage licence-exempt use and spectrum sharing technologies such as cognitive access.

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• By the late 1990s/early 2000s, a number of Member States had started to use market mechanisms in their management of radio spectrum, e.g. Auctions for the award of spectrum licences, the use of spectrum pricing (rather than cost recovery) to reflect the market price of spectrum and some Member States were considering the introduction of liberalisation and secondary trading.

• 2002 Regulatory Framework reflected a move towards a more market-based

approach. • Market-based approach studied in 2004 and the Commission published two

related Communications, the first in 2005 and the second in 2007. • 2009 new Framework Directive package – has a more explicit role for a market-

based approach to spectrum management. • EU 2020 Vision – The digital Agenda for Europe.

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The main objective is to support the internal market for wireless services and to

foster innovation in electronic communications and other sectors. There are four main areas of activity in EU radio spectrum policy:

• The identification of needs for spectrum coordination at EU level.

• Initiating harmonisation of spectrum usage in individual bands across Europe where necessary.

• The establishment of policy priorities in cases where there is conflict between different requests for spectrum use.

• Setting the regulatory environment for access to radio spectrum, with the aim of easier and more flexible access by public and private users. (my emphasis added)

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A concrete radio spectrum policy in the Community was launched by the 2002

regulatory framework, and particularly by the Radio Spectrum Decision (676/2002/EC) Two complementary bodies were set up following the Radio Spectrum Decision in 2002 to facilitate consultation and to develop and support radio spectrum policy:

The Radio Spectrum Policy Group (RSPG) is a group of high-level representatives that advise on broad policy in the area.

The Radio Spectrum Committee (RSC) which assists the Commission in developing technical implementation measures.

The Commission may also issue mandates to the European Conference of Postal and Telecommunications Administrations (CEPT) for the development of technical implementing measures.

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The 2002 Framework Directive + the specific directives + the Radio Spectrum Decision recognised the growing importance of a market-based approach to spectrum management through:

• Provision for secondary trading (but not mandated) - Article 9(3) Framework Directive and Article 5(3) Authorisation Directive refer. Trades subject to notification to the national regulatory authority (NRA). The NRA shall ensure that competition is not distorted - Article 9(4) Framework Directive.

• Provision for spectrum pricing - Article 13 of the Authorisation Directive.

• Member States required to establish an independent NRA with suitable right of appeal mechanisms.

• Establishment of EU institutional bodies charged with spectrum management.

• CEPT’s role as the body that provides expert advice, under Mandate(s) from the Commission, on the technical measures required to implement EU policy.

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The RSPG issued an opinion on WAPECS in November 2005 which endorsed the concept of greater flexibility in the use of spectrum based on the development of a set of coherent authorisation conditions limited to the minimum necessary to enable efficient use of spectrum.

The Commission, aided by the RSC, further considered these matters and, over the next few years, issued a series of Mandates to the CEPT to develop least restrictive technical conditions for the identified frequency bands. The initial (2005) list of frequency bands were:

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470-862 MHz: the band is used for broadcasting today, but issues arising from the digital dividend as well as convergence of broadcasting and mobile services call for action;

880-915 MHz / 925-960 MHz as well as 1710-1785 MHz / 1805-1880 MHz: these bands are used for GSM mobile services today, but issues surrounding the introduction of 3rd generation mobile services and the continuing restrictions in the GSM Directive call for action;

1900-1980 MHz / 2010-2025 MHz / 2110-2170 MHz; these bands are used for 3rd generation mobile services (IMT-2000/UMTS) today, but market developments point towards the introduction of broadcasting type services as well as broadband connections in residential and rural areas in the light of convergence;

2500-2690 MHz (the 2.6 GHz band); this band (still to be licensed) is intended for use by 3rd generation mobile services (IMT-2000/UMTS), but it is of equal interest for the provision of broadband using other technologies;

3.4-3.8 GHz: this band is used for broadband connections to the customer’s premises, but of equal interest for the provision of mobile services within the EU.

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Commission Decision (2008)411/EC on the harmonisation of the 3400 – 3800 MHz frequency band for terrestrial systems.

Directive 2009/114/EC amending Directive 87/372/EEC permits the 900 MHz band

identified for GSM to also be used for other technologies (UMTS). Commission Decision 2009/766/EC on the harmonisation of the 900 and 1800

MHz frequency bands – allows UMTS to use these bands as well as GSM. WiMax and LTE will be added to the Annex shortly, following completion of CEPT’s technical assessment of compatibility issues.

Commission Decision (2010)267/EU on harmonised technical conditions of use in

the 790 – 862MHz frequency band – part of the Digital Dividend from the switch- over from analogue television broadcasting to digital.

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Key Developments

Radio Spectrum Policy Programme (RSPP) – Article 8a(3) refers.

Service and technology neutral approach adopted for specified frequency bands – Articles 9(3) and 9(4) refers.

Transfer and leasing of spectrum rights (spectrum trading) to be enabled in specified frequency bands – Article 9b(1) refers.

Review of restrictions on existing rights – Article 9a(4) refers.

NRAs to ensure that competition is not distorted by transfer or accumulation of rights of use of radio spectrum.

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The RSPP is a new instrument in the area of radio spectrum management policy.

Under this provision (Article 8a(3)) the Commission may submit legislative proposals to the European Parliament and council for establishing multi-annual Radio Spectrum Policy Programmes (RSPP).

Developments

Consultation on the first RSPP issued in March 2010.

Commission proposal for a Decision of the European Parliament and of the Council – Establishing the first RSPP published on 20 September 2010.

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Highlights include:

800 MHz band (Digital Dividend) to be made available by 1 January 2013.

Member States to authorise the 900/1800/2600 MHz and 3.4 – 3.8 GHz bands for wireless broadband by 1 January 2012.

The 900/1800/2100/2600 MHz bands and the 3.4 – 3.8 GHz band to be made tradable (transfer or lease) as a priority.

Technology and service neutrality endorsed as a general regulatory principle.

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Policy objectives include:

Maximise flexibility in the use of spectrum.

Reduce fragmentation by enhancing coordination and harmonisation of technical conditions

Maintain and develop effective competition, in particular to prevent spectrum hoarding

Develop standards that allow flexibility and improve immunity of receivers.

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Important timing issues to note: After the 25 May 2011 Article 9(6) states that the provisions in paragraphs 9(3) and 9(4) regarding

technology and service neutrality shall apply to spectrum allocated to be used for ECS........ after the 25 May 2011.

Before the 25 May 2011 Article 9(6) states that spectrum allocations, general authorisations and individual

rights of use which existed by the 25 May 2011 shall be subject to Article 9a. Article 9a states that for a period of 5 years after 25 May 2011, rights holders with

more than five years remaining on their licence term may submit an application to the NRA for a re-assessment of the restrictions on their rights re services and technology.

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The 2002 Framework began the process of introducing a market-based approach to spectrum management

The 2009 Framework further advances the market-based approach through:

Member States are required to ensure that all types of technology and services may be used in those frequency bands that have been identified as available for ECS in the National Frequency Allocation Plan (some limited exclusions permitted such as the avoidance of harmful interference).

Places an obligation on Member States to regularly review the necessity of any restrictions and make the results of these reviews public.

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Practical Implementation

Technology neutrality must be set within the context of preventing harmful interference and, therefore, this whole process is closely linked to the technical reports produced by the CEPT under various mandates from the Commission. Flexible use is often an incremental process based on compatibility studies between specified technologies.

For example:

The 900 MHz and 1800 MHz bands previously used for GSM services were liberalised for use by GSM and UMTS systems in May 2010 following the completion of CEPT studies (ECC Report 82) and these bands will be further liberalised in the coming months by the addition of LTE and WiMax following the completion of CEPT’s studies (i.e. Reports 40 and 41).

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The Authorisation Directive aims to harmonise and simplify the rules and conditions related to authorisations required for ECS, thereby levelling the playing field in the EU and promoting open markets.

Article 5 (1) – Rights of use for radio frequencies and numbers:

This Article is intended to promote the use of general authorisations, as far as possible. Individual rights only permitted where justified in order to:

Avoid harmful interference

Ensure technical quality of service

Safeguard efficient use of spectrum

Fulfil other objectives of general interest as defined by Member States in conformity with Community law.

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Article 5(2) has a new requirement:

Where an undertaking has an individual licence that has been granted for 10 years or more and where that licence cannot be transferred or leased, the NRA has to review whether the original conditions are still appropriate - e.g. harmful interference risk is now reduced and, if so, the licence may be changed to a general authorisation or where if, constraint is still relevant, the licence has to be made transferable.

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A Digital Agenda for Europe – Flagship Initiative status

Aim is to deliver sustainable economic and social benefits from a Digital Single Market based on a fast and ultra fast internet.... With broadband access to all by 2013

Access to all for much higher internet speeds (30 Mbps or above) by 2020

50% or more households subscribing to internet connections above 100 Mbps

Radio spectrum is seen as an important component in addressing the Digital Agenda, particularly in rural areas using sub-1 GHz spectrum.

The release into the market of the 800 MHz band is seen as an important development in promoting rural coverage of mobile broadband services and will be a significant contribution to the 2020 Vision.

World Radiocommunications Conference 2012 (WRC-12) Agenda Item 1.17 considers issues for the 800 MHz band. EU has highlighted as a priority item. European Common Position (ECP) being developed as part of the CEPT process.

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Some Useful links are shown below:

• Study on conditions and options in introducing secondary trading of radio spectrum in the European Community May 2004 Analysys Dotecon http://ec.europa.eu/information_society/policy/ecomm/radio_spectrum/_document_storage/studies/secondary_trading/secontrad_final.pdf

• Ofcom consultation on trading and liberalisation: http://stakeholders.ofcom.org.uk/consultations/liberalisation/

• WAPECS - Opinion of the RSPG: http://rspg.ec.europa.eu/_documents/documents/opinions/rspg05_102_op_wapecs.pdf

• Digital Dividend- Opinion of the RSPG: http://rspg.ec.europa.eu/_documents/documents/opinions/rspg09_291_digitaldividend.pdf

• European Communications Office: http://www.ero.dk/

• UK Office of Communications: www.ofcom.org.uk

My contact details: brian.last@rraltd.com

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