Latest developments on spectrum management in EU/CEPT/UK

1. Regional Seminar on Economic aspects of spectrum management for Arab States Latest developments on spectrum management in EU/CEPT/UK Terry Jeacock (United Kingdom) Retired Head of Spectrum Engineering - Radiocommunications Agency (& Ofcom) Former Chairman CEPT Working Group Spectrum Engineering Former Vice Chairman CEPT WRC Preparatory Group

2. Regional Seminar on Economic aspects of spectrum management for Arab States Introduction • Overview of the European regulatory environment for spectrum management: - Relationship between EU/EC, CEPT, national administrations; - Summary of the mandatory and other harmonisation measures relevant to spectrum economics in Europe; • EU Directives: Regulatory framework for spectrum; • CEPT/ECC Decisions: harmonisation and flexibility; • United Kingdom: the road to spectrum trading.

3. Regional Seminar on Economic aspects of spectrum management for Arab States Community policy input,where justified Relationships: EU, CEPT, national administrations Spectrum management Spectrum policy CEPT: ETSI: spectrum technical harmonizationMember States: allocation, assignment Member States European Common Positions to e.g. WRC

4. Regional Seminar on Economic aspects of spectrum management for Arab States European spectrum harmonization mechanisms

5. Regional Seminar on Economic aspects of spectrum management for Arab States Ex ante regulationcommunications Competition regulationcommunications Authorisation Directive Liberalisation Directive (Art. 86)  Framework Directive (Art. 95)  Access & Interconnection Directive Data Protection Directive Spectrum Decision (Art. 95) Universal Service & Users’ Rights Directive Harmonizationspectrum policy EU Regulatory environment for communications sector 

6. Regional Seminar on Economic aspects of spectrum management for Arab States EU Framework Directive: • Obligation for national administrations to cooperate amongst each other andwith the Commission (incl. on spectrum matters); • Imposes principle of efficient use and efficient management of radio spectrumwhen regulating the sector (e.g. licensing); • Member States to promote harmonization of radio spectrum (see Spectrum Decision; • Allows (but does not mandate) the establishment of a secondarymarket forspectrum, but trading cannot result in change of usage where spectrum usagehas been harmonized. EU Authorization Directive: • Member States are bound in the context of authorizing network and services in the communication sector by measures established with a view of harmonizing spectrum. Member States cannot deviate from them when licensing nor impose additional conditions; • Spectrum Decision: links harmonization measures taken pursuant to theSpectrum Decision to the Authorization Directive and theFramework Directive.

7. Regional Seminar on Economic aspects of spectrum management for Arab States EU Spectrum Decision • Establishes a Radio Spectrum Policy Group to provide a platform for MS to discuss policy issues (no decision power, advisory only); • Establishes a Radio Spectrum Committee for decisions on technical implementing measures. Interface with CEPT through mandates for spectrum harmonisation. Legally binding decisions for MS through follow-up EC Decisions; • Legal obligation on MS to publish spectrum use information; • Ensures full involvement of EU institutions in international negotiations (confirmation of current practice).

8. Regional Seminar on Economic aspects of spectrum management for Arab States Market-based spectrum management and The European Communications Committee(CEPT/ECC)

9. Regional Seminar on Economic aspects of spectrum management for Arab States CEPT/ECC Decisions (inherent flexibility) • Outcome of any decision making process [only] on mattersof significant harmonisation in the electronic communicationsregulatory field; • Developed and writtenin as flexible away as possible; • Neither impose nor discriminate in favour of the useof a particular type of technology (“technology neutral”); • Strong encouragement (for EU members) to implement. The “legal” certainty is self-provided by the administration in the design of the national implementation measure; • Members signing the Decision committhemselves to make spectrum available according to market demand; • Reviewed by the ECC every three years from dateof adoption to determine the extent of its implementation and the take-up of anyfrequency bands designated (maintain, revise or abrogate). “Sunset clause”!

10. Regional Seminar on Economic aspects of spectrum management for Arab States ECC studies on harmonisation and flexibility ECC studies are well advanced on: • The overall direction of [ECC] harmonisation policy, bearing in mind that harmonising measures should be technology neutral, flexible and include review stages;  Investigating ways and possibilities of establishing a more flexible regulatory structure for spectrum management to better enable the introduction of new radio technologies and adapt to the changing market demand; • Studing additional opportunities for spectrum sharing, including sharing on the basis of geographical area(s), time and service, as well as the possible introduction of a flexible “noise temperature limit”.

11. Regional Seminar on Economic aspects of spectrum management for Arab States ECC studies on harmonisation and flexibility • CEPT has developed a report containing results of preliminary investigations into the issues of harmonisation and flexibility and the current regulatory framework for spectrum management. It is intended to inform and assist CEPT members, operators, manufacturers and other interested parties and presents proposals for further work to be undertaken by ECC and its Working Groups; • The Report considers the scope for enhancing flexibilityat all levels: national, European (EU and CEPT) and international (ITU-R). Some of the Report’s preliminary conlusions are considered in the following slides:

12. Regional Seminar on Economic aspects of spectrum management for Arab States ECC studies on harmonisation and flexibility Two licensing models under consideration for additional flexibility: • Flexible bands, where licensing conditions are laid down only for the protection of neighbouring bands whilst omitting any restrictions on services or technologies. These frequency bands should be harmonised at European level. Actions have been initiated at the CEPT level to find adequate frequency bands for such flexible bands and for defining the minimum requirements for compatibility. This work should be proactively pursued with high priority; • Light licensing regimes, where the position and characteristics of the stations are recorded on a database on a first-come first-served basis, with responsibility for subsequent users to ensure the compatibility with previously notified stations.

13. Regional Seminar on Economic aspects of spectrum management for Arab States ECC studies on harmonisation and flexibility Categorisation of bands • Category 1 band: full harmonisation essential mandated by international treaty - international services; safety and security; protection required; • Category 2 band: designated use includes bands designated in ECC Decisions, (which may also be designed in frequency Directives and possible future Commission Decisions); • Category 3 band: flexible use within specified technical criteria while allowing maximum flexibility to adapt to changing circumstances and ensuring that different uses (in-band and adjacent band) coexist without interference risk; • Category 4 band: no harmonisation A requirement for harmonisation has not yet been identified.

14. Regional Seminar on Economic aspects of spectrum management for Arab States Related ECC Reports • ECC Report 16: Refarming and secondary trading in a changing radiocommunications world (2002); • ECC Report 65: Auctions and “Beauty Contests” in CEPT administrations (2005).

15. Regional Seminar on Economic aspects of spectrum management for Arab States A European case study: The United Kingdom’s approach to market-based spectrum management.

16. Regional Seminar on Economic aspects of spectrum management for Arab States United Kingdom: the road to spectrum trading • 1982: An Independent Review of the radio spectrum concluded “Spectrum pricing is likely to be an ineffective and contentious method of rationing spectrum at either the allocation or assignment levels. This does not exclude a role for economic judgements in spectrum management….” • 2004: Ofcom Statement on Spectrum Trading: Ofcom is taking forward its reform programme through three inter-related projects. These are: - Spectrum Trading: mechanisms for allowing spectrum to change hands; - Spectrum Liberalisation: relaxation of constraints on the use of spectrum; - Spectrum Pricing: updating of annual fees for spectrum not acquired through auction. • 2005: Public Sector Spectrum Audit: recommends trading and spectrum pricing for public sector spectrum (including defence spectrum)

17. Regional Seminar on Economic aspects of spectrum management for Arab States 1985 prediction of cell-phone growth in the UK Source : Deregulation of the Radio Spectrum in the UK, DTI, 1987

18. Regional Seminar on Economic aspects of spectrum management for Arab States United Kingdom: the road to spectrum trading • Since December 2003, most non-military spectrum in the UK has been managed by the Office of Communications (Ofcom), an independent regulator also responsible for regulating telecommunications and broadcasting; • Ofcoms principal duties: to promote the interests of citizens and consumers, where appropriate through competition; secure the optimal use of the radio spectrum in the interests of all users. Believes that these objectives are, in general, best achieved through market mechanisms; • Overall control of spectrum, including allocation for military use, remains with the government; • since 1998, administrative incentive pricing and auctions used to promote optimal use of the radio spectrum. Introduced spectrum trading (December 2004) and liberalisation (January 2005); • In 2004 Ofcom published its Spectrum Framework Review, which sets out its high level approach to spectrum management.Progressive shift from ‘command and control’ to market mechanisms  and licence exempt by 2010.

19. Regional Seminar on Economic aspects of spectrum management for Arab States Ofcom: Command & Control; Market Mechanisms Licence-Exempt

20. Regional Seminar on Economic aspects of spectrum management for Arab States Ofcom: shifting from command and control to market mechanisms Getting the balance right: Ofcom preference is to move away from central management, allowing market forces to prevail and increasing the use of licence-exemption.

21. Regional Seminar on Economic aspects of spectrum management for Arab States Summary of Ofcoms plans to make spectrum available to market

22. Regional Seminar on Economic aspects of spectrum management for Arab States Audit on UK Public Sector Spectrum Holdings The consultation document: • Identifies specific bands which may have the potential for more effective use; • Proposes that, in the future, the public sector will need to meet new spectrum demands through market mechanisms in all but exceptional cases; • Expresses support for public bodies being able to trade spectrum rights – and benefit from doing so – if they wish and addresses possible barries to this; • Assesses the need for the public sector to adopt a more stregic approach to spectrum management, suggesting that the UK Spectrum Straegy Committee should produce a regular forward look of public sector spectrum need; • Examines possibilities for improving Administrative Incentive Pricing including extending it in some areas e.g. in the aeronautical sector and changes to better reflect band sharing; • Sets out the audits intention to encourage more band sharing, through clarification of the incentive structure and the possibility of engaging a third party to facilitate the process; • Addresses specific organisational issues which may be preventing more efficient use of the spectrum holdings such as procurement processes and information sharing.

23. Regional Seminar on Economic aspects of spectrum management for Arab States Finally:Thank you for your attention! Terry Jeacock has retired from the UK Administration and is attending this Workshop as an independent expert. He does not represent Ofcom, the United Kingdom, CEPT or the ITU. The information presented has been obtained from publicly available sources, including: European thematic portal (europa.eu.int/information_society) European Radiocommunication Office (www.ero.dk) Ofcom (United Kingdom) (www.ofcom.org.uk) Audit of Spectrum Holdings: (www.spectrumaudit.org.uk)