Spectrum Pricing Proposes Fairer Fees

DTI Press Release - 28 May 1999


Radiocommunications Agency Proposals for further Spectrum Pricing Changes to the way that licence fees are charged for radio spectrum have been announced by the Radiocommunications Agency.

Spectrum pricing was introduced last July to replace the previous fee system which resulted in market distortions, with smaller users paying more pro-rata than larger users of spectrum.

The new proposals, set out in a Consultation Document last year, received wide acceptance. The Radiocommunications Agency (RA) now propose a second wave of spectrum pricing with changes to licence fees, to be introduced over a four year period, commencing in July 1999.

Two new licences are proposed in the Private Business Radio (PBR) sector: the Wide Area Private Business Radio Licence and the National and Regional Private Business Radio Licence. These licences will provide more choice for PBR users to determine which particular service best suits their business needs. It is anticipated that the proposals will result in lower fees for the majority of licensees using the new Wide Area Class.

Notes for Editors

1. The proposed Regulations continue the implementation of spectrum pricing in the United Kingdom, Channel Islands and Isle of Man. Further Regulations will be introduced next year, following a third consultation, which will extend the principles of spectrum pricing into all areas of radio use.

2. The consultation focused on further fee increases to the Public Mobile Operator (PMO) licensees, refined the Private Business Radio (PBR) sector, having built on last year's changes, and extended the principles of spectrum pricing to the Point to Point Fixed Links sector.

3. The proposals introduce further changes in the way fees are calculated for the PBR On - Site Licence, by introducing charges based on the number of channels in use by each individual system, and also by introducing the concept of congestion in frequencies or band width.

4. The increases are not expected to have any significant impact on charges to mobile telephone subscribers.

5. Point to Point Fixed Links, fees will again be calculated on the basis of the amount of congestion in that particular frequency or band. Congestion is defined on either geographical location of the service (e.g. there is more demand for spectrum in Central London than anywhere else in the country), or by the number of users of a particular frequency or band, and the extent of coverage.

6. The following documentation on the proposals is available on request; Second Wave Consultation Document (September 1998)
Summary of Responses to the Consultation Regulatory Impact Assessment Draft Fee Regulations

For Copies of the proposals please contact Des Daly on 020 7211 0477
or e:mail des.daly@ra.gsi.gov.uk

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