Regional Seminar on Economic aspects of
spectrum management for Arab States
On-going work in ITU-R Study Group 1 on
market-based spectrum management issues
Mr Terry Jeacock (United Kingdom)
Former Chairman ITU-R Study Group 1
Former Co-chairman JG WTDC Resolution 9
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Regional Seminar on Economic aspects of
spectrum management for Arab States
“Command & Control”
“Licence-free”
(a.k.a. “GOSPLAN” )
(a.k.a. “the COMMONS”)
“Nobody knows best”
- No Legal Protection
- Technical Protection
- High flexibility
- “Government knows best”
Future of
national
spectrum
management
- Pro- “Innovation”
- “Optimists”
??
“Property Rights”
- “first come, first served”
- Beauty Contests
- Low flexibility
- Pro “Government”
Economists: “maximise value”
(a.k.a. “the MARKET”)
- “Market knows best”
- Auctions/Secondary trading
- High flexibility
- Pro “Big Business”
Engineers: “avoid
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interference”
Regional Seminar on Economic aspects of
spectrum management for Arab States
SG 1 studies on market-based spectrum
management
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Mechanisms to assist financing national spectrum management?
Additional tools to assist when demand exceeds supply?
Opportunities to decrease national regulation?
Mechanisms to increase flexibility to respond quickly to market
needs?
A “Spectrum Tax” to raise revenue for the government?
A complete replacement for “traditional” spectrum management?
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Regional Seminar on Economic aspects of
spectrum management for Arab States
Scope of Study Group 1
(relevant to this workshop):
• Development of principles and techniques for effective
spectrum management;
• Sharing criteria and methods;
• Techniques for spectrum monitoring and long-term
strategies for spectrum utilization and economic
approaches to national spectrum management;
• Assistance in matters within its competence to developing
countries in cooperation with the Telecommunication
Development Sector.
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Regional Seminar on Economic aspects of
spectrum management for Arab States
Work programme of Study Group 1
(relevant to this workshop):
•
•
•
•
•
Spectrum economics
Alternative methods of national spectrum management
Increased flexibility in spectrum allocation
Role and task of radio monitoring in a liberal environment
In co-operation with ITU-D SG2: development of the
“Spectrum Fees” database in accordance with WTDC-02
Resolution 9 and Question 21/2
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Regional Seminar on Economic aspects of
spectrum management for Arab States
Key Questions under study:
• Q.206: Strategies for economic approaches to national spectrum
management and their financing;
• Q.207: Assessment, for spectrum planning and strategic
development, of the benefits arising from the use of the radio
spectrum;
• Q.208: Alternative methods of national spectrum management;
• Q.216: Spectrum redeployment as a method of national spectrum
management;
• “Flexible” spectrum use:
- Q.224: Technical convergence (for WRC-10),
- Q.229: International regulatory framework (for WRC-07)
• ITU-D Q.21/2: Calculation of Spectrum Fees
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Regional Seminar on Economic aspects of
spectrum management for Arab States
Results of studies:
ITU-R Report SM.2012-1
Economic aspects of spectrum management
• Consists of five Chapters which describe the different
economic approaches for spectrum management activities;
• Includes case studies on administrations’ experience
regarding the economic aspects of spectrum management;
• intended for the use by administrations of both developing
and developed countries in their development of strategies
on economic approaches to national spectrum management
and to the financing of this activity;
• analysis of the benefits of strategic development and the
methods of technical support for national spectrum
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management.
Regional Seminar on Economic aspects of
spectrum management for Arab States
ITU-R Report SM.2012-1:
Strategies for economic approaches to national spectrum
management and their financing
Spectrum pricing
•Provides transparency in national assignment;
•Discourages spectrum stockpiling and hoarding;
•Provides an incentive for spectrum refarming;
•Method to quickly assign spectrum when there is a high level of
competition and demand;
Approaches
•Spectrum fees: Incentive, Opportunity Cost
- based on actual spectrum use and estimated market value
•Auctions
-Market forces fully determine the value of the spectrum 8
Regional Seminar on Economic aspects of
spectrum management for Arab States
ITU-R Report SM.2012-1:
Spectrum Rights and Spectrum Trading
As a consequence of Spectrum Pricing, need to consider:
Spectrum Rights obtained by the licencee:
•Definition of what the licencee may use the spectrum for,
•Protection from interference etc..
Spectrum Rights retained by the administration:
•All international obligations
and
Spectrum Trading
•Trade all or part of the spectrum associated with the licence
•Transferrable spectrum rights.
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Regional Seminar on Economic aspects of
spectrum management for Arab States
ITU-R Report SM.2012-1:
Assessment, for spectrum planning and strategic development
purposes, of the benefits arising from the use of the radio
spectrum
Requirement for assessment
• Assessment of the economic benefits are useful in making spectrum
planning decisions and in the comparison of different options
• Quantification of these benefits is required for spectrum planning and
strategic development
Methods
• gross domestic product (GDP) and employment;
• consumer and producer surplus.
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Regional Seminar on Economic aspects of
spectrum management for Arab States
ITU-R Report SM.2012-1:
Alternative methods of national spectrum management
•
•
•
•
As consequence of market based approaches,
administrations should consider options and
requirements to transfer spectrum management
resonsibility to (e.g.):
communication groups with a direct interest in spectrum
such as advisory committees, trade associations;
professional organizations, and quasi-governmental
associations;
frequency coordinators (and coordination groups) and
designated spectrum managers; and
spectrum management consultants, and support contractors.
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Regional Seminar on Economic aspects of
spectrum management for Arab States
Results of studies:Recommendation SM.1603
“Spectrum redeployment “refarming” as a method of
national spectrum management”
Definition:
“A combination of administrative, financial and technical measures
aimed at removing users or equipment of the existing frequency
assignments either completely or partially from a particular
frequency band. The frequency band may then be allocated to the
same or different service(s). These measures may be implemented
in short, medium or long time-scales.”
Contents:
An analysis of the requirements, methods, costs, funding and
compensation arrangements, potential problems. A case study.
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Regional Seminar on Economic aspects of
spectrum management for Arab States
“Flexible” spectrum allocation?
• Likely requirement of spectrum trading because: the less
restrictions on applications that can use a spectrum range, the
greater its value;
• Opportunities to apply RR No. 4.4 ?
• But no protection rights and non-interference obligations = less
value, especially in border areas;
• Broader Service definitions in RR?
• Improved methods for co-ordination between Services with
dissimilar technical characteristics?
• Must maintain administrations’ rights and equitable spectrum
access principles.
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Regional Seminar on Economic aspects of
spectrum management for Arab States
Results of studies: Flexible spectrum allocation
Approved Recommendations:
• SM.1133: Spectrum utilization of broadly defined
services
• SM.1265-1: National alternative allocation
methods
In preparation:
• Report to WRC-07: International regulatory framework
• Report to WRC-10: Technical convergence (mobile, fixed
broadcasting)
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Regional Seminar on Economic aspects of
spectrum management for Arab States
Role and task of radio monitoring
in a liberal environment
• Q.225: Inspection of radio stations to verify
compliance with license parameters
• Q.215: Monitoring of the radio coverage of
land mobile networks to verify compliance
with a given license
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Regional Seminar on Economic aspects of
spectrum management for Arab States
WTDC-02 Resolution 9 and
Question 21/2 “Calculation of frequency fees”
• Study: Analysis of the various principles, methods,
formulas and approaches used by administrations
for calculating spectrum use fees;
• Output: An electronic document structure and
links enabling users to have easy access to data on
frequency fee calculation formulas for the users of
the radio frequency spectrum in different
countries;
• Output: Case studies and examples of use.
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Regional Seminar on Economic aspects of
spectrum management for Arab States
Spectrum Fees Data Base: Query screen
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Regional Seminar on Economic aspects of
spectrum management for Arab States
Formula: K1*K2*(Total Frequency Band / 25 KHZ)*1 896.30 €
K1=frequency band coefficient: 1 = below 470 MHz, 0.8=470-960 MHz etc…..
K2=geographic coverage coefficient: actual coverage area / total area of country 18
Regional Seminar on Economic aspects of
spectrum management for Arab States
Handbook on National Spectrum
Management
Chapter 6: Spectrum Economics
(Written to be low on theory, high on practice!)
• Spectrum licencing approaches
• Spectrum pricing
• Spectrum rights
Annex 1: An application of spectrum pricing
Annex 2: Cost of spectrum redeployment
Cost of Handbook 73 CHF
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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 or the ITU. He has resigned his ITU chairmanships. The information
presented has been obtained from publicly available sources, including:
ITU (Study Group 1) (www.itu.int/ITU-R/study-groups/rsg1/index.asp)
European thematic portal (europa.eu.int/information_society)
European Radiocommunication Office (www.ero.dk)
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