25/09/2007

Application of spectrum liberalisation and trading to the mobile sector | Ofcom

Application of spectrum liberalisation and trading to the mobile sector | Ofcom

Ofcom, following a decision by the RSC (which sets radio spectrum policy in the EU and other areas) is consulting on what should be done with spectrum in the 900MHz and 1800MHz bands.

900MHz is currently used by O2 and Vodafone, while 1800MHz is utilised by T-Mobile, Orange, O2 and Vodafone (though T-Mobile and Orange utilise the bulk of it).

Ofcom could re-allocate the spectrum in several ways (and have come out with 4 options, 1 through D where A is just re-use and D is complete re-allocation).

Since the characteristics of the 1800MHz band are similar to that of the 2.1GHz (2100MHz) and even 2.5/2.6GHz bands, the economic case for re-allocation (including disruption to existing operators) doesn't seem the best way forwards and Ofcom is proposing just to allow spectrum re-use (i.e. currently only 2G services can be utilised in this spectrum, but Ofcom is proposing that 3G services will also be allowed, but by the existing operators).

900MHz is much more valuable spectrum as it has very good propogation characteristics (especially in built-up areas). Ofcom are therefore proposing to revoke some spectrum from O2 and Vodafone's allocations. It is likely that O2 and Vodafone will complain bitterly, especially O2 as they are rolling-out an E.D.G.E. network (which is GSM based) to support Apple's iPhone and other terminals - so they are upgrading their existing network, only to be mandated to release spectrum.

By releasing two blocks of spectrum in the 900MHz band, Ofcom would allow 2 new entrants into the market who could offer 3G or wireless broadband services. This would increase competition and allow new services to be offered. There are already 3G networks running on 900MHz so equipment is readily available.

O2 and Vodafone will not be allowed to bid on the revoked spectrum.

Anyone wishing to respond to the consultation has until the 29th of November to do so.
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