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03|02|09

A better digital dividend for Britain

Ofcom has announced proposals to align more of the spectrum released as part of the UK’s digital dividend with other European countries.

This will allow new wireless services, particularly mobile broadband, to be launched here and across Europe.

The UK has led Europe in creating a digital dividend - the spectrum freed up for new uses as a result of digital television switchover.

These airwaves are particularly important because the signals they carry travel over long distances and penetrate into buildings well.

Digital dividend

The decision to release a digital dividend was taken by the Government in 2003, before Ofcom came into existence.

The plan developed at that time involved releasing two distinct bands of spectrum, one of which comprised 48 MHz between 806-854 MHz.

It is now clear that a growing number of other European countries will release a digital dividend, but within a slightly wider block of spectrum than the UK’s, at 790-862 MHz (the so-called 800 MHz band).

Finland, France, Sweden and Switzerland have already decided to release this wider block of spectrum of 72 MHz. We expect a number of other countries to do likewise.

Mobile broadband

Today’s consultation considers whether the UK should align more of the spectrum it is releasing with the digital dividend in other countries, so that the whole 800 MHz band becomes available for new uses.

Our analysis shows that there would be large benefits to citizens and consumers from doing this. These would include:

• lower equipment prices for consumers
• more efficient use of spectrum
• improved opportunities for new generations of mobile broadband
• more scope for competition and innovation in new wireless services

Ofcom believes that the net benefits to consumers could be worth £2-3 billion over twenty years.

These proposals would mean some changes to the spectrum used by digital terrestrial television (DTT) services and wireless microphones.

Set-top boxes

Ofcom’s plans set out how these changes can be made without materially affecting the coverage or reception of DTT.

However, some DTT viewers may need to re-tune their digital set-top boxes or integrated digital televisions.

This is a simple procedure that usually takes a few minutes to complete and will already be necessary as a consequence of digital switchover.

Ofcom proposes to make alternative spectrum available UK-wide for wireless microphones, replacing the spectrum that will form part of the 800 MHz band.

’Freedom and flexibility'

Ofcom also proposes that funding should be made available so that the existing and planned users of this spectrum do not have to bear extra costs as a result of these changes. This funding could come from new licensees in the 800 MHz band, or the Government.

Ofcom’s aim is to maximise the value that the services using the digital dividend create for citizens and consumers over time.

Our strategy is to release the digital dividend in a way that gives users as much freedom and flexibility as possible to decide how it is used, creating major new opportunities for competition and innovation in communications.

The consultation is available here.Ofcom expects to publish a statement on this issue in summer 2009 with a view to holding the auction for the UK’s digital dividend in 2010.

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