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In March 2006 the Government published its response to the Independent Audit of Spectrum Holdings (PDF, 1.7Mb). The Government's response (PDF, 124Kb) committed Ofcom to conducting a study in the application of Administered Incentive Pricing (AIP) to the aeronautical and maritime sectors and, subsequently, to consulting on the subject.

In June 2006, pursuant to that commitment Ofcom commissioned the consultants Indepen and Aegis to carry out the study. In relation to spectrum allocated to aeronautical and maritime applications, Indepen-Aegis were asked to:

• Establish whether legitimate non-market factors exist that might influence the application of AIP to relevant bands
• Establish a priority list of frequency bands used by the aeronautical and maritime sectors for the initial application of AIP
• Establish if, and how, sharing will influence the level of AIP in relevant bands
• Develop pricing options and an optimal methodology for calculating costs and prices for relevant bands
• Identify AIP options that take account of unwanted emissions, such as those from radars into neighbouring bands
• Identify likely implementation issues and options for managing the introduction of AIP into relevant bands

The study has now been completed and the report is available below.

While it is Ofcom's view that market mechanisms including AIP are key to securing optimal use of the spectrum, the report highlights a number of issues relating to its application to the aviation and maritime sectors. Ofcom intends to explore these further with the Civil Aviation Authority, the Maritime and Coastguard Agency, the Department for Transport (the DfT) and other relevant stakeholders prior to the consultation on this matter, which is expected later in 2007. It should be noted that the report reflects the consultants' views only and does not constitute Ofcom's view or Ofcom policy.

1.2 Further information and next steps

The Government recently published its Forward Look (PDF, 1.2Mb) for managing major public sector spectrum holdings. Further information relating to the Independent Audit and implementation of the Government's commitments in response to the Audit can be found at www.spectrumaudit.org.uk.

General comments may be emailed to: audit.implementation@ofcom.org.uk. If you wish to express an interest in participating in pre-consultation discussion or register to receive the consultation document in due course you may do so to the same address.

• Aeronautical and maritime spectrum pricing [pdf]
  Full Print Version - A report by Indepen-Aegis published 24|04|07

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