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Spectrum Framework Review Implementation Plan:FAQs

General

1. What is the Spectrum Framework Review Implementation Plan?

This is the first time a UK regulator has helped businesses plan for the future by setting out a comprehensive programme of potential spectrum awards over a number of years.

The awards offer businesses the opportunity to develop valuable new applications which have the potential to offer consumers new services. For example,

Spectrum at 2.5 GHz could be used for a wide range of mobile applications, whether using 3G standards or other next generation mobile services.
Spectrum currently used as a buffer zone between GSM mobile and DECT cordless phones could soon be used for a range of services including private GSM networks, which would allow private mobile networks covering business sites, university campuses or other organisations to allow employees and students to use the same mobile phone handsets that they use now.
Newly-available frequencies at 2010 and 2290 MHz could be used for mobile broadband technologies such as WiMax.
40MHz of spectrum in the so-called 'L-Band' (at 1450MHz) could be used for broadcast multimedia technologies such as video to mobile, or 'mobile TV'.

2. What are Ofcom’s statutory requirements when it comes to spectrum management?

The Communications Act 2003 Act includes a statutory duty on Ofcom to secure the optimal use for wireless telegraphy of the electro-magnetic spectrum (section 3(2)(a)).

Section 3 requires Ofcom to further the interests of citizens and consumers and secure the availability throughout the UK of a wide range of services (section 3(2)(b)).

Section 4 requires Ofcom to fulfil the “six community requirements” set when managing the wireless spectrum in the UK . Of particular relevance are the following:

The requirement to promote competition (section 4(3));
The requirement to act in a ’technology neutral’ way (section 4(6)); and
The requirement to encourage such compliance with international standards as is necessary for- (a) facilitating service interoperability; and (b) securing freedom of choice for the customers of communications providers. (section s4(9) and (10))

In addition to these general duties and considerations, section 154 of the 2003 Act sets out a number of specific duties which apply to the management of the spectrum. In summary these require Ofcom to have regard to the desirability of promoting:

efficient management and use of the spectrum;
the economic and other benefits that may arise from the use of wireless telegraphy;
the development of innovative services;
competition in the provision of electronic communication services.

3. Why does spectrum need to be regulated?

If access to the spectrum was completely unregulated there would likely be intolerable interference in many areas. One of the roles of the spectrum manager is therefore to ensure that no two users transmit on the same frequency at the same time and sufficiently close together that they create harmful interference with each other.

There is also an international dimension to spectrum management as radio signals do not stop at international borders.

4. What is the purpose of this document?

Ofcom published its Spectrum Framework Review (SFR) in November 2004 which set out its vision for market forces to play an increasingly important role in determining how spectrum is used.

The Spectrum Framework Review: Implementation Plan addresses how the vision for spectrum management set out in the SFR can be implemented in two key areas

the release of newly available spectrum into the market over the next 2-3 years; and
the transition to spectrum trading and liberalisation in relation to mobile services.

5. What is spectrum trading and liberalisation?

Spectrum trading allows the holder of certain categories of wireless telegraphy licences to transfer all or part of their rights and obligations under a licence to another party.

Liberalisation involves the reduction or removal of restrictions that presently limit the use of spectrum to a particular purpose and/or a particular technology. Liberalisation will give additional flexibility to use spectrum in different ways, promoting more efficient use of the finite spectrum resource.

Future spectrum awards

6. Which bands will be available and when will they be awarded?

The document identifies twelve bands that it expects to be available before the end of 2008. The table below summarises the proposals in this document for 8 bands below 3GHz.

Bands below 3GHz	2005-2006	2006- 2007	2007-2008
1781-1785 MHz/1876-1880 MHz (GSM/DECT guard bands)	●
2290-2302 MHz	●
2010-2025 MHz	●
410-415 MHz/420-425 MHz, 872-876 MHz/917-921 MHz (parts of 2 bands)	●
2500-2690 MHz		●
1452 -1492 MHz (L Band)		●
1790-1798 MHz			●

Ofcom also expects to make a number of awards in bands over 3 GHz during this period. These include the possibility of further awards at 10GHz, 28 GHz, 32 GHz, and 40 GHz.

The document also discusses three bands for which no particular date is identified for release. These are:

174-230 MHz (part thereof) ‘Band III’. Ofcom has already indicated (see Radio – Preparing for the Future, published 15 December 2004 ) that it expects to consult on the timing of an award in Band III in Spring 2005.
470-854 MHz (part) (the ‘digital switchover dividend’ spectrum) Ofcom does not expect to make any policy decisions on this spectrum until after the Regional Radio Conference has concluded in 2006. Any award would not be until some time after then.
3.6-4.2GHz (part). This spectrum is presently used inter alia for fixed links, fixed satellite services, and fixed wireless access. Subject to further work, Ofcom considers that there may be scope for additional use for terrestrial services.

See also details in the media release; http://www.ofcom.org.uk/media_office/latest_news/nr_20050113a and the document itself http://www.ofcom.org.uk/consult/condocs/sfrip/

7. Where does ‘new’ spectrum come from?

Spectrum is a finite natural resource, and there is no such thing as ‘new’ spectrum. However, from time to time individual companies and institutions such as the Ministry of Defence return frequencies to Ofcom.

8. Does Ofcom consider there to be a need for more 3G services/another operator?

Ofcom is not proposing to make more spectrum available specifically for 3G services. Rather, Ofcom’s view is that the market is better placed than a regulator to judge the optimum commercial service and technology. It should therefore be for those acquiring spectrum to decide what services to offer and what technologies to use.

Spectrum in the 2500 -2690 MHz band (often known as the 3G expansion band) has been earmarked for assignment across Europe by the beginning of 2008. The UK has relocated the existing users in this band faster than other EU countries: in our case it will be available for assignment from the beginning of 2007.

Ofcom considers that it is in the interests of citizens and consumers to make spectrum that is under-used available to the market as soon as possible, consistent with an orderly process for release.

9. What are the alternative mobile technologies which might be deployed?

the wide range of IMT-2000 technologies
the wide range of technologies based on IEEE standards in the 802. series (including, for example, 802.16 a and e, which enable fixed broadband services, hot-spot backhaul and mobility, and which may be certified as WiMAX products)
proprietary technologies.

10. How does this relate to the study into spectrum held by the public sector being led by Professor Martin Cave?

This document is focussed on spectrum release in the short to medium term. Given the lead times involved in major changes in spectrum allocations, it is likely that Professor Cave ’s audit of public sector spectrum holdings will focus more on long-term issues. Ofcom welcomes the review and is working actively in support of Professor Cave’s work.

11. What is Ofcom’s preferred means of awarding spectrum frequencies and why?

In general, Ofcom proposes to use auctions as the principal means of assigning spectrum, where demand for the spectrum is likely to exceed supply. This approach is most likely to ensure that a particular spectrum band flows to its most valuable use. However, there may be occasions where, for strong public policy reasons, Ofcom may wish to specify a particular use, and to choose a different method of assignment such as comparative selection.

12. How will you design the auctions?

Ofcom will look at the circumstances of each band that it plans to auction in deciding the most appropriate design for an auction. It is likely to employ a number of designs in its programme of auctions. It will engage specialist advisers to assist in developing these. In each particular case Ofcom will consult on the proposed detailed design before it is adopted.

Mobile services

13. What are Ofcom’s key proposals in relation to mobile services?

The document discusses a number of options for extending spectrum trading to the spectrum used for mobile services. Subject to resolving the issues discussed, Ofcom expects to extend spectrum trading to mobile spectrum in 2007.
The document considers the issues raised by the possible extension of spectrum liberalisation to the existing 2G bands. It identifies a number of considerations here, including international legal constraints (eg the GSM Directive) and the structure of the market for 3G services that was created by the 3G auction in 2000. It seeks views about the best way forward. In parallel, Ofcom is commissioning an economic study by external consultants to evaluate the scale of the issues and possible solutions.
It also discusses the potential for removing restrictions on the use of other spectrum, so that it could be used for mobile services. It proposes that in general Ofcom should be willing to remove restrictions (where it is possible to do so under law, and given interference constraints and international obligations) that prevent the use of spectrum for mobile services (other than 3G services) as soon as practicable.
The document considers whether there is a case for a transitional period before removing restrictions on the ability to use spectrum not presently used for mobile services for 3G services in the future. It suggests that this transitional period might last till 2007.

14. Why 2007?

Retaining restrictions on the provision of 3G services until 2007 is just one of the options Ofcom is considering. This would be about seven years from the auction of the 3G licences. There is an argument that this proposal would give an appropriate notice period to the existing licensees.

Liberalisation in 2G spectrum

15. What bands are used for 2G spectrum?

There are two bands presently used for 2G: the GSM 900 band (880 – 915 MHz and 925 – 960 MHz) and the GSM 1800 band (1710 – 1785 MHz and 1805 – 1880 MHz).

16. What are your proposals on liberalising 2G spectrum?

The document sets out an initial analysis of the issues relating to the extension of liberalisation to the existing 2G spectrum. Ofcom welcomes the views of respondents on the issues and questions identified.

In parallel to this consultation Ofcom will be conducting further economic analysis of the issue with the assistance of external consultants. The conclusions of that analysis will together with the responses to this consultation document form the basis for Ofcom’s decision on the issue. Ofcom plans to give respondents an opportunity to comment on the findings of the economic study later in the year.

Roll out obligations

17. Is Ofcom proposing to extend the term of the 3G licences?

No. There is no intention of changing the term of the 3G licences (which last till 31 December 2021 ).

18. Is Ofcom proposing to remove or amend the roll-out obligations on the 3G licensees?

No. Ofcom is making no proposals for any change to the roll-out obligations, which require the 3G licensees to cover 80% of the UK by population by 31 December 2007 .

See below for Ofcom’s proposal to issue guidance on the enforcement action that it might take in the event of non-compliance with the roll-out obligations.

19. Why do they exist?

According to information at the time of the auction, they were included to promote the efficient use of spectrum and to promote the more widespread availability of services in the interests of consumers.

20. Are they achievable?

Several networks have already begun to offer commercial services, and some are reportedly close to (or are already) meeting the requirement. The commercial pressures on operators to roll out their networks are very considerable, quite apart from the ‘backstop’ of the regulatory obligations.

21. What is Ofcom proposing?

Ofcom is proposing to issue guidance on the approach that it would expect to take to enforcement of the obligations in the event that a licensee does not comply with its roll-out obligations, though it would only be able to decide what action to take at the time, in light of all relevant factors.

22. What does the guidance say?

The draft guidance says that Ofcom considers that revocation of a licence would only appear to be proportionate in serious cases of non-compliance.

Instead, Ofcom might ask the operator to demonstrate that it will be able to comply within a specified reasonable period, by producing a detailed programme for achieving the required level of roll-out. It says that we might ask for evidence that this programme has technical and financial approval at Board level, and that it includes specific target steps and an agreed schedule for monitoring progress.

It also says that it might be appropriate for Ofcom to consider varying the licences of non-compliant licensees, to reflect the timetable for achieving compliance.