Industry warns radio frequencies may become scarcer than oil


Germany's first spectrum auction in five years started today

This article is part of our special report Enabling the Next Technology Revolution.

SPECIAL REPORT / While the EU faces the serious risk of a new indefinite delay in regulating radio spectrum access across member states, industry warns against mobile data gridlocks and potentially higher prices for smartphone usage, as frequencies become “scarcer than oil”. EURACTIV reports from the Mobile World Congress in Barcelona.

By 2020, in Europe there will be more than 30 times as much mobile internet traffic as there was in 2010, according to European Commission forecasts.

The telecoms industry foresees a ten-fold global increase of mobile data traffic between 2013 and 2019. “If total monthly smartphone traffic is 1 exabyte today, in 2019 it will be 10 exabytes,” reads the Ericsson Mobility Report 2013.  

In terms of mobile subscriptions, whether with smartphones, cell phones or other devises, the forecast is set at 9.3 billion globally by 2019, from 6.6 billion in 2013.

Against this surge in demand, and since the radio spectrum through which all this traffic goes is a limited resource, it is not unfair to say that “frequency will be scarcer than oil,” Ericsson's Ulf Ewaldsson said. In these conditions, prices will go up and the quality of service will go down.

Ewaldsson is a vice-president of Ericsson, which is one of the European companies in the frontline of the development of the infrastructure aimed at sustaining the future of data traffic, the so-called 5G, or fifth generation of mobile connections.  

The regulators’ quagmire

But for technology to provide the necessary solutions, regulators must play a key role.

The European Union, with its fragmented market, is a business’ nightmare, despite the frequent proclamations about the importance of the single market.

The reform of the telecoms sector tabled by the European Commission last September, for all its flaws, remains the only attempt to make radio spectrum access more harmonised and simpler across Europe.

However, this week’s postponement of the vote on the reform in the committee of the Parliament with the main responsibility for the dossier makes it hard for the EU assembly to pass the legislation within its current mandate, as its last plenary session is in April.

Even in the case of a positive vote, negotiations with member states are likely to drag on to the second semester of 2014 when a new Parliament is set to take office, making the outcome of the lengthy legislative process even more unpredictable.

The Commission proposal addresses the politically hot issue of spectrum allocation, trying to define which frequencies should be assigned across the continent to different users, whether mobile operators, broadcasters or satellite operators.

Each EU country has a different history of spectrum usage, with states traditionally giving, for instance, priority to broadcasters, as in Italy or the UK, or to public security services, like in some Eastern European nations.

The Commission proposed to attribute a specific part of the radio spectrum to Internet mobile operators, in order to allow companies to have a clearer legal framework all across the continent.

With no overhaul approved, the situation is set to remain as fragmented as it is now. Moreover, the other issue of spectrum auctioning at member state level will remain untouched.

The commissioner in charge of digital agenda, Neelie Kroes, last year called for an end to what she called the “spaghetti spectrum” in Europe. She went so far as to say that in the future it may be possible for the EU to be the only body responsible for auctioning the European spectrum.

But she had to downsize her expectations after resistance from member states and conflicting interests within the industry. Asked on the sidelines of a conference at the MWC in Barcelona this week about a possible deadline for a common spectrum auction in Europe, she said: “I don’t dare to say”.

Reacting to the postponement of the vote on the proposal for a telecoms single market at the industry committee (ITRE) of the European Parliament, EU Digital Agenda commissioner, Neelie Kroes, said: "I am confident that this postponement will not distract the ITRE Members from their vote on this important proposal.This postponement only increases the energy I will put into delivering this package."

"We are firm believers in the benefits that allocating spectrum to mobile internet will bring to our societies. Without spectrum availability, we wouldn’t be speaking of the app economy or of the transforming power of mobile today. Our industry is best placed to inform on which spectrum bands are needed and at which point in time," is the official line of ETNO, which brings together  the main European telephone operators.

“ICT infrastructure is becoming as important as electricity or water and is key for the competitiveness of countries,” said Ken Hu, deputy chairman of Huawei, China’s main telecoms networks developer.

“But mobile infrastructure deployment should be made easier. Spectrum demand and distribution mechanisms should be better aligned to reduce spectrum costs, as they account for more than 20% of total costs” of  telecoms infrastructure developers, Hu said speaking in an event on the sidelines of the MWC in Barcelona. 

Nicola Frank, Head of European Affairs at the European Broadcasting Union (EBU), said: “Spectrum is a finite resource and its allocation a matter of public interest. It must be allocated in a balanced and efficient way to meet the needs of society. It is indispensable for digital terrestrial broadcasting, which provides near universal coverage, guaranteed quality of service and affordable free-to air TV and radio to citizens across the EU. Over 250 million viewers rely on the terrestrial platform for their primary television services.”

Radio frequency spectrum is a limited part of the electromagnetic spectrum, but it is extremely important due to its capacity to carry codified messages.

This makes it an essential resource for telecommunication services such as mobile telephones, TV and radio broadcasting, satellite and broadband communications.

The allocation of spectrum has been marked by intense debate between member states on which services should be prioritised and how countries can conduct spectrum auctions around the same time to make sure the roll out does not create an uneven playing field.

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