APRSC 2016
9 March 2016
Facilitating the Wireless Broadband
Connection of Hong Kong
Sanda Cheuk
Assistant Director (Regulatory)
Office of the Communications Authority
Hong Kong
Agenda
Overview of Hong Kong’s mobile
telecommunications market
Principles in spectrum management
Approaches for meeting the booming demand
for wireless broadband services
2
Overview of Hong Kong’s
Mobile Telecommunications Market
3
Growth of Mobile Services
No. of MNOs: 4
No. of MVNOs: 23
Total no. of mobile
subscribers:
16.7 million
(penetration at 228%)
No. of 3G/4G
subscribers:
14.1 million
(penetration at 193%)
No. of 2G/2.5G
subscribers:
2.6 million
4
Growth of Mobile Data Usage
Sustained robust growth
in monthly mobile data
usage
Last 12 months
+26%
Last 2 years
+66%
Last 3 years
+161%
Last 5 years
+983%
5
Principles in Spectrum Management
6
Role of Communications Authority
in Spectrum Management
The Communications Authority (CA) has a wide range
of powers under the Telecommunications Ordinance
for management of radio spectrum
Promoting the efficient allocation and use of the radio
spectrum as a scarce public resource of Hong Kong
Power to assign, vary or withdraw frequencies
Power to designate frequency bands subject to spectrum
utilisation fee (SUF)
Due regard will be given to the Radio Spectrum Policy
Framework promulgated by the Government in 2007
7
Radio Spectrum Policy Framework (April 2007)
Spectrum policy objectives
Facilitate the most economically and socially efficient use of spectrum
with a view to attaining maximum benefit for the community
Achieve technically efficient use of spectrum to facilitate the introduction
of advanced and innovative communications services and strengthen
Hong Kong’s position as a telecommunications and broadcasting hub
Fulfil Hong Kong’s regional and international obligations relating to the
use of spectrum
Strengthen Hong Kong’s strategic position as a world city and the gateway
between the Mainland of China and the world by facilitating the provision
of key services in Hong Kong
Ensure that necessary spectrum is reserved for Government services
8
Radio Spectrum Policy Framework (April 2007)
Guiding Principles for spectrum management
Use of a market-based approach wherever the CA
considers that there are likely to be competing demands
for the spectrum, unless there are overriding public policy
reasons to do otherwise
No legitimate expectation for any right of renewal or right
of first refusal of any spectrum assignment upon expiry
Reasonable advance notice to be given for any withdrawal
or variation of spectrum assignment
Spectrum Release Plan to be published on potential supply
of spectrum for competitive bidding or tendering
9
Approaches for meeting the booming demand
for wireless broadband services
(1) Timely Release of Radio Spectrum
10
Spectrum Release Mechanism
Spectrum Release Plan
A 3-year spectrum release plan has been published every
year on a rolling basis
Inform the industry about any spectrum available for
assignment through market based mechanism
Launch of consultation for spectrum assignment upon
application by the industry or at the initiative of the CA
The CA aims to release available spectrum blocks as
soon as they are made available to enable the public to
enjoy the benefits of advanced wireless technologies as
early as possible
11
Potential Supply of New Spectrum
Keep track of industry, regional and international
developments
Active participation in the ITU’s World Radiocommunication Conference
New spectrum for IMT services
New allocation for government uses and commercial applications
Planning for the analogue switch-off (ASO)
Government target of ASO for television broadcasting in 2020
Frequency coordination with the Mainland required for benefit
from digital dividend
Assessing the feasibility of sharing use the existing
spectrum (e.g. TV White Space)
12
(2) Effective Spectrum Assignment /
Re-assignment
13
Assignment of Spectrum
In exercise of the CA’s power under the TO and having
regard to the Radio Spectrum Policy Framework and
international regulations and standards, spectrum
assignments are made through different approaches
for different frequency bands:
Licensing through auction (e.g. public mobile services)
Licensing through administrative means (e.g. fixed links,
government uses)
Licence-exempt allocation (e.g. WiFi, cordless phone)
14
Assignment of Mobile Spectrum
Spectrum for public mobile telecommunications services
A total of 572 MHz of spectrum has been assigned (800/900 MHz,
1800 MHz, 1.9-2.2 GHz, 2.3 GHz and 2.5/2.6GHz bands)
Likely no or limited new spectrum available before ASO
Default market-based approach for both assignment of new
spectrum and re-assignment upon expiry of existing assignments
Distribution of Spectrum among MNOs
233.6
41%
MHz
250
200
134.4
23%
150
100
96.4
17%
107.6
19%
50
-
CMHK
HKT
Hutchison
SmarTone
15
Re-assignment of 3G Spectrum
120 MHz of spectrum in the 1.9 – 2.2 GHz band assigned through
auction in 2001 will expire in October 2016
Objectives in spectrum re-assignment
1
Ensuring customer service continuity
2
Efficient utilisation of spectrum
3
Promotion of effective competition
4
Encouragement of investment and
promotion of innovative services
16
Re-assignment of 3G Spectrum
Full engagement with stakeholders
Two rounds of public consultation from March 2012 to July 2013
A consultancy study commissioned to study any impact on service quality
and consumers stemming from different spectrum re-assignment options
Decision of the CA announced in November 2013
A hybrid administratively-assigned cum market-based approach adopted
to re-assign the 120 MHz of spectrum
3 years advance notice given to the incumbent 3G operators on the
spectrum re-assignment arrangements
Outcome of re-assignment
Number of 3G operators increased from 3 to 4
Total of $7 billion of SUF to be collected from the spectrum assigned
through auction and offer of right of first refusal
2x15 MHz of spectrum will change hand
17
Re-assignment of 2G Spectrum
198.6 MHz of spectrum in the 900 MHz and 1800 MHz
bands will expire in 2020/21
900 MHz
1800 MHz
19 Nov 2020
3 Jan 2021
11 Jan 2021
29 Sep 2021
Hutchison
SmarTone
HKT
All 4 MNOs
(45 days)
(8 days)
Competing demands likely exist for the spectrum
market-based approach should be adopted
Consideration of any overriding public policy reasons
(e.g. continuity of 2G voice services) for not adopting the
market-based approach
Same four spectrum re-assignment objectives
18
Re-assignment of 2G Spectrum
CA and Secretary for Commerce and Economic Development
launched first stage public consultation on 3 February 2016
on approach of re-assignment and setting of SUF
Proposed options currently under consultation
Option 1 – full-fledged administratively-assigned approach
Option 2 – full-fledged market-based approach
Option 3 – hybrid approach
Consultation to close on 18 April 2016
Aim to make a decision around November 2017 (i.e. three
years before expiry of existing assignments)
19
(3) Promote Efficient Spectrum Utilisation
20
Spectrum Refarming
Technology neutral principle
Spectrum generally assigned on technology neutral basis
MNOs may use any widely recognised technology for
service provisioning with the assigned spectrum
Spectrum can be refarmed without the need for
regulatory approval
A large proportion of the 2G spectrum has already been
refarmed for the provision of 3G/4G services
21
Spectrum Refarming
A large proportion of the 2G
spectrum has been re-farmed
to provide 3G/4G services
22
Spectrum Swapping
Building up of contiguous spectrum
Reduce adjacent channel interference
Improve spectral efficiency
Increase network capacity
Two precedents of frequency swaps in recent years
November 2012: 1800 MHz band
January 2016: 2.5/2.6 GHz band
23
Spectrum Swapping
Swap in 1800 MHz Band
SMC
CMHK
CMHK
SMC
CMHK
CMHK
CMHK
Other MNOs
CMHK
CMHK
Other
MNOs
CMHK
Original Frequency Assignment
SMC
Other
MNOs
SMC
Frequency Assignment after the Swap
Other MNOs
Swap in 2.5/2.6 GHz Band
Original Frequency Assignment
Other MNOs
CMHK
HKT
HKT
HKT
HKT
CMHK
Frequency Assignment after the Swap
Other MNOs
HKT
CMHK
CMHK
24
Mobile Data Offload through Public Wi-Fi
Light-handed licensing and regulatory approach for public
WiFi services
Operate on unlicensed spectrum in the 2.4 GHz and 5 GHz bands
5 carrier licensees authorised to provide municipal WiFi services
42 class licensees registered to provide indoor WiFi services
No restriction for deployment of seamless mobile-WiFi handover
Extensive coverage of public Wi-Fi service
39,750 registered Wi-Fi access points
MTR stations, Airport Express stations and trains, buses,
ferries, etc.
Offices, shopping malls, coffee shops, restaurants,
convenient stores, etc.
Public hospitals, public libraries, parks, tourist spots, etc.
25
(4) Facilitate Implementation of Wireless
Broadband Infrastructure
26
Deployment of Small Cells
Variety of configurations
Femto cells
Pico / micro cells
Range from 10m to several hundred metres
Advantages of small cells
Boost mobile network capacity by cell-splitting and
spectrum re-use
Bring users closer to base stations and improve signal
reception
Easier to find installation sites and more cost effective
27
Deployment of Small Cells
Possible Locations for Installation
Payphone Kiosks
Bus Stops / Shelters
Lamp Posts
Shops on the Street
28
Assignment of Backhaul Links
OFCA facilitates extension of mobile broadband coverage
by use of microwave backhaul links for
Connection of small cells to the core network
Connection between base stations / hill-top sites
More efficient and cost effective mobile broadband
coverage in remote and rural areas
29
Mobile Network Sharing
Mobile network sharing is permitted to –
Lower the cost of building and operating mobile infrastructure
Expedite rollout of mobile networks
Avoid over-construction of mobile base stations
Make more efficient use of sites
Enable the provision of higher speed data services
Existing forms of mobile network sharing in Hong Kong
Antenna sharing
Site and equipment sharing
Capacity leasing
New forms of mobile network sharing (e.g. carrier
aggregation) may be explored subject to compliance with
licence obligations
30
Example of Mobile Network Sharing
Sharing of all and part
of the Radio Access
Network (RAN)
equipment or facilities
Each mobile network
operator maintains its
own separate logical
RAN using its own
assigned spectrum
31
“Our vision is that Hong Kong has the world-class communications
services to meet the challenges of the information age” (Communications
Authority’s Vision Statement)
Thank You