Annual Report and Accounts 1999-2000
To support Departmental objectives by:
managing spectrum in accordance with a clear strategic plan, which:
The fifth edition of the annual Spectrum Strategy was published in March 2000. The fact that this publication has doubled in size since the first edition, published in 1995, reflects the way in which the task of spectrum management has grown in complexity over a relatively short period. Demands on the spectrum continue to increase. For example, whereas in 1995 there were just four million mobile telephone users, there are now around 24 million. In the same period digital television coverage has been extended to 90% of the UK population and a host of other new services have come on stream.
With the development of new and innovative services, the Agency's role is to manage the radio spectrum effectively, in support of the Government's aim of "building a successful and competitive knowledge economy that is the best in the world for electronic trading while providing high quality service to its customers".
The preparation and publication of the Spectrum Strategy is one of the main ways in which we seek to fulfil that aim.
Detailed preparations continued through the year for the auction of licences for Third Generation (3G) mobile telecommunications spectrum. These included the publication of an Information Memorandum on 1 November 1999 and the making of the statutory instrument which provided the detailed legal rules for the auction. To increase sustainable competition by attracting one or more new entrants to the UK mobile market, the largest of the five licences auctioned was reserved for a new entrant. Increased competition is expected to encourage the faster introduction of 3G services, innovation and cheaper prices. Thirteen companies, of which nine were potential new entrants, applied to participate in the auction which began on 6 March 2000.
Since the period of this report, readers will be aware that the auction concluded in April 2000. The auction results are shown in table 1.1 (opposite).
Broadband Fixed Wireless Access at 28GHz and 40GHz
The Agency published the consultation document Wireless in the Information Age in July 1999. The consultation was launched by Michael Wills MP, the then Parliamentary Under-Secretary of State for Small Business.
51 responses were received, and in response to the views expressed in these responses, the Agency decided to make radio spectrum licences available for Broadband Fixed Wireless Access at both 28GHz and 40GHz.
In January Patricia Hewitt MP announced the Government's plans to make these licences available in two tranches, 28GHz and 40GHz, by the end of the year, thereby meeting industry's concerns that some broadband spectrum should be made available as soon as possible to enable the UK to keep up with developments in the rest of Europe and to stimulate competition in the broadband market as a whole.
A Consultative Group was established as a forum for industry to advise the Agency on all issues relating to the award of licences, including the appropriate award procedure, spectrum packaging, competition, industry structure and licensing and regulatory issues. The Agency appointed KPMG as its market and financial consultant, who provided an assessment of the market prospects for Broadband Fixed Wireless Access at 28GHz, and in the light of this, advised on how spectrum should be packaged and the most appropriate means of awarding licences.
Fixed terrestrial and satellite links
There was buoyant demand throughout the year for new links, particularly for the shorter-hop fixed links required to expand network infrastructures. The current number of licensees and licensed links is shown in table 1.2 on page 13.
Both the Fixed Links Spectrum Management (FiLSM) and Satellite Earth Station Co-ordination Management (SECOM ) computerised assignment systems are now operational. The initial teething problems, which affected service levels and turn-round times for fixed terrestrial links, have now been resolved.
Table 1.1: Auction results
|Licence A||TIW UMTS (UK) Limited||2x15 MHz paired spectrum, plus 5 MHz unpaired spectrum.|
|Licence B||Vodafone Limited||2x15 MHz paired spectrum.|
|Licence C||BT(3G) Limited||2x10 MHz paired spectrum, plus 5 MHz unpaired spectrum.|
|Licence D||One2One Personal Communications Limited||2x10 MHz paired spectrum, plus 5 MHz unpaired spectrum.|
|Licence E||Orange 3G Limited||2x10 MHz paired spectrum, plus 5 MHz unpaired spectrum.|
|Patricia Hewitt MP receives 3G auction applications|
The first step was taken to introduce spectrum pricing for the frequency bands allocated to fixed terrestrial links, and the Agency continued to discuss with industry the best way forward for the introduction in 2001 of spectrum pricing arrangements for Permanent Earth Stations.
A timetable has been agreed for a phased programme to bring under direct Agency control all fixed link frequency bands currently self-managed by major operators. In combination with the opening of new bands above 50 GHz , this will enable the Agency to provide fair and equitable access to an increased general pool of spectrum. It is expected there will be a continuing high demand for links, both for the expansion of existing networks and also for new emerging requirements such as Third Generation Mobile operations.
Fixed Wireless Access (FWA)
Spectrum at 2.4GHz
Atlantic Telecom Group PLC has been operating a successful FWA service in Scotland since October 1996 using low power spread-spectrum technology in the 2.4 GHz band. The company currently operates networks in all four of Scotland's major cities and connects to 52,000 domestic and business customers. The current network offers 'plain old telephony service' (POTS) but with certain valued added features (such as two lines to each customer) and an innovative tariff structure. While the current network is voice-only, the company has recently launched a data network offering Internet connectivity at data rates of up to 2Mb/s, with a subscription-based 'unmetered' tariff structure.
During the year Atlantic Telecom Group was awarded six licences covering regions in the UK and is currently planning to implement a service in the first of these regions for summer 2000.
Spectrum at 3.6 - 4.2 GHz
Following successful trials in the Thames Valley, Tele2 (UK) Ltd have set up an 'always on' high speed internet access service (up to 2 Mb/s) in Leicester. Services are planned to commence shortly in Bradford, Leeds and Nottingham. During the year ahead, services are planned to open in forty areas in England, Scotland and Wales.
Public mobile telephony
The number of subscribers to the four operators (BT Cellnet, Vodafone, Orange and One-2- One) has increased dramatically over the year and now exceeds 24 million.
|Radio enables Internet use wherever you need it|
Work has continued in the European Telecommunication Standards Institute (ETSI) on the development of "2.5 generation" enhancements to the GSM standard, such as SoLSA (Support of localised service area), EDGE (Enhanced Data rates for GSM Evolution), GPRS (General Packet Radio Service) and AMR (Adaptive Multirate Codec).
Plans for the migration of the analogue (E-TACS) networks to the digital (E-GSM) networks are being developed with the cellular operators. The Agency is planning to conduct a review of which other existing or new services could make use of the spectrum released by the closure of the TACS network.
There continues to be a strong market interest in cordless telephones for residential and office use. Domestic cordless telephones based on the DECT specification have become widely available and there continues to be a strong customer base in the UK for analogue cordless telephones.
In November 1999 the Agency undertook a review of the spectrum allocated to cordless telephones in the UK. The review concluded that CT2, extended range CT0 (MPT 1371) and CT0 (MPT 1322) phones could be phased out over a five year period.
The Agency has also conducted a review of TETRA spectrum, which looked at how much spectrum is currently available for TETRA systems and the prospects for and timing of the release of further spectrum. The review is enabling the Agency to assess how best to assign the currently available spectrum.
Dolphin Telecommunications Ltd is currently licensed to use 100 duplex national channels (2 x 2.5 MHz), and has rolled out a network providing coverage to over 90% of the population. The company plans to install many more base stations to extend coverage and provide greater capacity in major urban areas. The Agency has examined Dolphin's business case and has assessed their spectrum needs. This assessment, alongside the views of other interested parties, will be included in a Ministerial submission later in the year.
Public Mobile Data operators
Public Mobile Data operators in the UHF bands can now be licensed on a case-by-case basis to increase their base station power output from 25 watts to 100 watts, to improve coverage. The increase is subject to site clearance and is permitted on a non interference basis.
Operators have requested spectrum around 900 MHz for a new generation of palm sized mobile data terminals. The Agency is investigating the technical options; one possible solution might be to accommodate these systems in the guard band between UIC, GSM and TETRA at 876 and 921 MHz.
Power line and digital subscriber line technologies
The Agency has worked closely with industry and users on new broadband technology for use over power and telephone networks. An Agency working group has developed a draft standard known as MPT1570. This standard sets out proposed limits of radiation and methods of measurement. The Agency is consulting on a draft regulatory impact assessment and when this is complete the standard will be submitted through the UK Cabinet Office Official Committee on Spectrum Strategy before final approval by ministers.
CEPT project team 35 is also working on this technology and this work is being fully supported by the Agency. Further European work with the German administration in formulating a potential common standard on power line and digital subscriber line technologies is also progressing.
Following the consultation paper Spectrum for asset tracking mobile data networks using spread spectrum techniques, in June 1999, Quiktrak (UK) Ltd has been awarded a licence to provide asset tracking services. The primary band for this service is 866 to 868 MHz. The Agency will conduct further technical evaluation of the potential for sharing this band with other, similar, CDMA asset tracking systems. If sharing is possible, the Agency will consult on awarding further licences.
Common Base Stations (CBS)
The Agency has allocated 20 national and 80 regional channels in sub-band 1 of Band III to facilitate the migration of CBS (UHF1) out of the 410 to 430 MHz CEPT-harmonised TETRA band. The intention is that the 80 regional channels will become CBS-exclusive as large public operators give back spectrum in Band III to the Agency.
Private business systems
The period was dominated by the change-over to the Agency's new licensing system (RULES) and continued evolution towards Spectrum Pricing. Despite the introduction of these major changes, PBS Section maintained its work programme, implementing licence changes with a number of its major customers; analysing data and completing the Band III audit; and identifying spectrum to assist the introduction of new radio systems in the transport sectors. The section contributed towards the international development of standards and undertook some important consultation with industry on future developments for its PBR Suppliers Licence and the future direction of RLAN and HIPERLAN standards. The complicated re-planning exercise associated with the 450-470 MHz Band Realignment project will increasingly involve the radio industry in decisions determining the future band plan.
In July 1999 the second stage of administrative spectrum pricing was implemented by Parliamentary regulation. The second stage extended the principles of pricing by spectrum value rather than administrative cost to most public telecommunication network, fixed link and private business radio licences. For users of exclusive spectrum or for use in congested areas this resulted in higher fees, but the bigger increases are being staged over three or four years. Fees remained the same or were reduced for shared or non-congested spectrum. In the Private Business Sector, licences were restructured into new classes to reflect extent of spectrum coverage (for which prices are now proportionate).
|Guards on the Docklands Light Railway use radio to keep in contact|
The Agency issued a consultation document in September 1999 (Implementing spectrum pricing - the third stage and beyond) on the remaining stages of implementation proposed to be actioned over the next two years. Based on further analysis by Smith and NERA on spectrum value, we looked at how spectrum pricing could be used in other sectors including aeronautical, maritime and technology development, and in other classes (e.g. private paging) of the sectors already started in the second stage. Further changes in these sectors are planned for implementation in July 2000, involving many fee reductions for shared spectrum use. At the same time, further staged increases for public telecommunications and fixed links, and increases for existing radio fixed access licences were planned.
Further consultation is anticipated in 2000 for Broadcasting, Programme Making, Satellite and other fixed services. Further work on monitoring the effectiveness of pricing will also be tackled.
|BBC local radio transmitter at Washford, Somerset|
Table 1.2: Fixed Terrestrial and Satellite Links
Table 1.3: Number of Licences on issue at 31 March
|AERONAUTICAL Aeronautical Ground Stations|
|AGS (Special Mobile)||55||54|
|Glider/Balloon/Hobby Ground Stations||325||1,141|
|Aeronautical Ground Stations Sub Total||1,353||2,025|
|Tier Code A||853||795|
|Tier Code B||386||392|
|Tier Code C||4,577||4,577|
|Glider/Balloon/Hobby Air Stations||1,143||370|
|Aircraft Sub Total||6,959||6,134|
|Amateur Radio A||30,574||31,091|
|Amateur Radio B||24,605||24,711|
|Amateur Radio A/B||253|
|Amateur Radio Novice A||225||237|
|Amateur Radio Novice B||2,706||2,887|
|Amateur Radio Total||58,363||58,926|
|Citizens' Band Radio||33,949||38,617|
|Amateur and CB Total||92,312||97,543|
|Transmission of Terrestrial UHF TV Services||2||2|
|Transmission of National and Local|
|Broadcasting Services (2)||248||130|
|Restricted Radio Services Transmission (3)||16||15|
|Fixed Radio-Relay Link||272||301|
|Fixed Millimetric Radio-Relay Link (58GHz)||227||230|
|Scanning Telemetry Link||67||71|
|Point to Multipoint||47||34|
|Fixed Services Total||613||636|
|MARITIME Coastal Station Radio|
|Coastal Station Radio Sub Total||1,930||1,410|
|Ships Radio Sub Total||62,790||60,332|
|PRIVATE BUSINESS RADIO (4)|
|Private Mobile Radio (Standard)||3,785||16,015|
|Private Mobile Radio (On-site)||25,319||13,555|
|Private Mobile Radio Road Construction||20||22|
|Radio Paging (Standard)||10,558||7,860|
|Private Wide Area Paging||332||251|
|Local Authority (Emergency Alarm) Radio||15||22|
|Police and Fire Service Comprehensive Radio||119||123|
|Short Range Business Radio||11,400|
|Wide Area Private Business Radio||14,898|
|National and Regional PBR||59|
|Private Business Radio Sub Total||57,636||50,948|
|PROGRAMME MAKING & SPECIAL EVENTS|
|Programme Makers and Special Licences (5)||1,497||1,296|
|Programme Making Sub Total||1,497||1,296|
|PUBLIC TELECOMMUNICATIONS NETWORKS|
|Common Base Station Operator||897||942|
|Public Mobile Operator||31||35|
|Public Mobile Communications Sub Total||934||984|
|SPACE SERVICES (6)|
|Permanent Earth Stations||178||145|
|Transportable Earth Stations||92||80|
|VSAT Stations (7)||32||25|
|Miscellaneous Earth Stations (inc TT & C)||25||17|
|Space Services Sub Total||327||267|
|Testing and Development||941||694|
|Radar Level Gauge||196||166|
|Technology Development Sub Total||1,170||944|
Secretary of State Stephen Byers MP visited the Agency on 13 October, to find out about our work at first hand. He talked with Directors first, who explained the Agency's role and structure, and how we are approaching the Modernising Government challenges. Then he was taken up to the 14th floor, not only to admire the views, but to meet RA staff, and also to unveil the Investor in People plaque and another plaque marking the Agency's return to Docklands. In a short speech to the group of about 40 people, who represented all sections and ranges within the Agency, he picked out Modernising Government and the knowledge-driven economy as particularly important issues, and said that he was pleased to see how the Agency was already contributing to these two objectives. He also spoke about IiP and the importance of investing in people, our most important resource.
|Marcel Roccia explains the benefits of e-licensing to the Minister|
Finally, David Hendon, the Chief Executive, took him round the room to talk informally to the groups of staff about their work.
Patricia Hewitt MP, Minister for e-commerce and small firms, visited the Agency on 13 December.
Her visit began with a briefing on the work of the Agency from David Hendon, Chief Executive and Mike Goddard, Director of RA1, and then a meeting with all the Directors and a brief demonstration of the RA website. She was then taken on a tour round the Agency to see at first hand some of the most exciting elements of our work. These areas included broadband issues, Private Business Radio, and e-commerce and Modernising Government in the context of fixed radio link networks. Finally Ms Hewitt met Barry Maxwell and his team to be given an insight into the Agency's work in the areas of pirate radio and enforcement.
|Chris Winton and Tony Mason show the Secretary of State a pirate transmitter|