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Mobile Multimedia Communications

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DTI Press Release - 18 May 1998

The UK's position at the forefront of the third generation of mobile telecommunications was confirmed today by Barbara Roche, Minister for Small Firms, Trade and Industry.

In a written answer to a Parliamentary Question from Patricia Hewitt MP (Leicester West) she said:

"The UK has been at the forefront of developing mobile telecommunications in Europe, and I am determined that it should retain that position. Third generation mobile - also known as UMTS or Universal Mobile Telecommunications Systems - offers exciting prospects for new jobs, new services and new investment, and I aim to ensure that the UK benefits fully from this new technology."

"To that end, we intend to hold an auction of UMTS licences in the summer of 1999, subject to market and other developments and to final decisions nearer the time. This timetable takes account of responses to the Government's consultation document 'Multimedia Communications on the Move', further discussions with industry, and advice from N M Rothschild & Sons."

"In offering through an auction licences to use specified frequencies for the delivery of UMTS, the Government's overall aim is to secure, for the long term benefit of UK consumers and the national economy, the timely and economically advantageous development and sustained provision of UMTS services in the UK."

"Subject to this overall aim the Government's objectives are to (i) utilise the available UMTS spectrum with optimum efficiency; (ii) promote effective and sustainable competition for the provision of UMTS services; and (iii) subject to the above objectives, design an auction which is best judged to realise the full economic value to consumers, industry and the taxpayer of the spectrum.

"In developing detailed auction proposals, my Department will continue fully to consult industry."

Mrs Roche will chair the EU Telecomms Council tomorrow, at which a draft Decision promoting and facilitating the adoption of UMTS in the EU will be considered.

Notes to Editors:

1. The UK was the first country in Europe to introduce competitive analogue mobile phone networks based on the TACS (Total Access Communications System) standard and was in the forefront in the world in the establishment of GSM digital networks. The UK again led the world in 1988 by proposing in its consultative paper "Phones on the Move" that digital cellular systems could be operated at around 2 gigahertz. This led to the establishment of the Orange and One to One Personal Communications Networks. The UK was also the first country in Europe to begin consultation on the licensing of third generation networks.

2. Universal Mobile Telecommunications Systems (UMTS) comprise the European component of the global family of third generation mobile systems known as IMT-2000. UMTS will allow a much higher data transmission rate (up to 2 megabits/second) than present second generation mobile systems (currently capable of 9.6 kilobits/second).

It will therefore provide high speed access to a large number of entertainment and information services, such as:

* business services, including virtual banking, on-line billing and full mobile office services;

* home shopping;

* real time video, including video conferencing and on-line entertainment;

* the wealth of material on the Internet.

3. The DTI issued on 31 July 1997 a consultation paper entitled "Multimedia Communications on the Move" (MCM) which set out detailed proposals for licensing UMTS. One of the main proposals in MCM was that UMTS licences should be allocated by auction.

4. The Government has appointed four main advisers to prepare for the proposed auction. These are N M Rothschild & Sons Ltd as financial advisers, Allen & Overy as legal advisers, Quotient Communications and Ovum as technical advisers and a team based at University College London as auction design advisers.

5. Consultation with industry is facilitated by the UMTS Auction Consultative Group (UACG), chaired by the Radiocommunications Agency (RA). UACG papers are available on the RA's website, which is at: www.radio.gov.uk

Copies of MCM and industry responses to MCM are also available on the site.



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P/98/393

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