1. Radio Spectrum Policy in Europe
Research Seminar on Telecommunications Business
Radio Spectrum Policy in Europe
Timo Smura
Henrik Saksela

2. Radio Spectrum Policy in Europe
Radio spectrum is
Valuable
2 – 2.5% of EU GDP
85% of value by mobile and broadcasting
A scarce resource
Need for regulation
Increasing in demand
Rapid development of new technologies
Radio Spectrum Policy in Europe

3. Major drivers of European policy
Radio Spectrum Decision
Policy and legal framework
Radio Spectrum Committee
Radio Spectrum Policy Group Decision
Radio Spectrum Policy Group
Radio Spectrum Policy in Europe

4. Radio Spectrum Policy Group
Advice to EC on policy and strategy
Spectrum trading
Spectrum technology neutrality
Impact of digitalisation of broadcasting
Radio Spectrum Policy in Europe

5. Spectrum situation today
Broadcasting spectrum plan
Defined in 1961
Becoming obsolete – replacement planned
Mobile spectrum plan
Frequencies for GSM proposed by ITU in 1982
European Community adopted them in 1987
First network in 1991 (Radiolinja)
Long-term process
Radio Spectrum Policy in Europe

6. Spectrum situation tomorrow
Broadcasting goes digital
Estimated 50 – 75% of current broadcast spectrum free for other uses
New mobile services
Flash-OFDM already being deployed
WiMAX likewise
UWB …?
More flexible management needed!
Radio Spectrum Policy in Europe

7. Spectrum management approaches: three issues
Spectrum allocation
What types of uses should be allowed?
Spectrum assignment
Who should be allowed to operate the frequencies?
Centralised vs. decentralised decisions
Allocation & assignment decided by state or by users?
Radio Spectrum Policy in Europe

8. Spectrum policy approaches
allocation
assignment
Command-and-control approach
Centralized, use of spectrum pre-defined
Centralized, trading not allowed
Market-based approach
Liberalized, license holders may choose how to utilize the spectrum
Primary assignment centralized, secondary trading allowed
Commons approach
Centralized, restrictions on technology and Tx power levels
Unlicensed spectrum, no assignments
Radio Spectrum Policy in Europe

9. Radio Spectrum Policy in Europe
Command-and-control
Traditional way
Government decides everything
First-come-first-served
WiMAX frequencies in Finland
Beauty contests
TV, Radio, 3G in Finland and Sweden
Auctions
3G in Britain, Germany
Radio Spectrum Policy in Europe

10. Market-based approach
Primary assignment by government by e.g. auctions
Secondary trading allows rights to be sold
Owner decides how to use spectrum
Limitations to avoid interference
European Commission plans to introduce spectrum markets in the EU by 2010
Radio Spectrum Policy in Europe

11. Radio Spectrum Policy in Europe
Commons approach
Government allocates license-exempt spectrum
Anyone can utilize the spectrum
Limitations
Transmission power levels to avoid interference
Parts of spectrum for specific technologies
Fertile ground for innovations
WLAN, Bluetooth
Further harmonisation on EU-level considered
Radio Spectrum Policy in Europe

12. Radio Spectrum Policy in Europe
Outlook
Each approach has its strengths and weaknesses
Future policy undoubtedly a combination of approaches
Which combination is optimal?
Which bands should be open for trading / liberalisation?
Which bands should be unlicensed?
Which bands should be managed by the government?
Radio Spectrum Policy in Europe

13. Spectrum policy impacts
Market-based management increases innovativeness and competitiveness?
Analysis of industry responses to public consultation by the European Commission
“Public consultation on secondary trading of rights to use radio spectrum”
Radio Spectrum Policy in Europe

14. Spectrum policy impacts cont.
One group completely opposed to change
Satellite operators
Spectrum trading without change-of-use better than complete liberalisation
Radio Spectrum Policy in Europe

15. Spectrum policy impacts cont.
Perceived benefits of secondary trading
Lower entry and exit barriers
Increased competition
Driver for market consolidation
Increased efficiency of spectrum usage
Operators can balance their needs by trading spectrum
Surplus capacity put to other use in sparsely populated areas, e.g. wireless broadband
Radio Spectrum Policy in Europe

16. Spectrum policy impacts cont.
Negative effects of secondary trading
Spectrum hoarding
Uncertain availability of spectrum
Smaller incentives for long term research by device manufacturers
Replacement of low revenue public interest services by higher revenue services
Radio Spectrum Policy in Europe

17. Spectrum policy impacts cont.
Technology neutrality without service neutrality
Upgrade path utilizing available spectrum
Faster time-to-market for new technologies
Increased competition between technologies
Radio Spectrum Policy in Europe

18. Spectrum policy impacts cont.
Negative effects of liberalisation
Smaller economies of scale for device manufacturers
Interworking and roaming difficult
Higher prices for end users
Radio Spectrum Policy in Europe

19. Spectrum policy impacts - Summary
Radio Spectrum Policy in Europe

20. Radio Spectrum Policy in Europe
In conclusion
Transition to more flexible spectrum management will happen, but in stages
Important to consider effects of trading and change-of-use separately
Questions and comments are welcome!
Radio Spectrum Policy in Europe