Risks, Opportunities Seen in EU Spectrum Program, FCBA Told
Carrying out the EU’s first multiyear spectrum policy program may expand mobile broadband and enable innovation and investment in member countries, but could also add uncertainty in competition, spectrum license renewal and loss of spectrum assets, speakers said at an FCBA briefing Monday. In a few months, EU member states will begin following through on 2009 changes in the EU regulatory framework.
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The spectrum program includes new provisions on how spectrum is managed, with added emphasis on spectrum efficiency, flexibility and technical and service neutrality, said Gerry Oberst, a partner in Hogan Lovells’ Brussels office. May-July 2011 is the expected timeframe for spectrum policy adoption, said Oberst, but member countries are unlikely to meet the deadline. Failure to comply could result in legal battles and EC proceedings, he said.
The program means mobile operators can deploy 3G and 4G technologies over 900 and 1800 MHz spectrum, said Winston Maxwell, a partner with Hogan Lovells’ Paris office. But a request for spectrum refarming will trigger a competitive assessment that could result in loss of key spectrum assets, he said. A competitive assessment could even occur in the absence of refarming request, Maxwell said. There’s no clear rule on how competitive assessments will be done, Oberst said. The limited visibility of competitive assessment will leave lots of uncertainty, Maxwell said. And spectrum holders with WiMAX 3.5 GHz satellite spectrum, for example, could ask for permission to offer 4G services in competition with mobile operators, he said. National regulatory authorities may also limit incumbent mobile operators’ right to bid for additional spectrum, Maxwell said. The program could also affect renewal of 900 and 1800 MHz licenses, he said.
For regulators and governments in member countries, the program will provide new tools to increase competition and innovation, generate significant revenue through auctions, and expand broadband in rural areas, Maxwell said. But regulatory authorities could also face additional legal fights because of the uncertainty of the competitive assessment mechanism, he said. And some remedies look good on paper but are hard to use, Maxwell said. The ability of some spectrum holders to offer 4G mobile services may reduce revenue from future auctions, he said. Too much competition could weaken markets and ultimately hurt consumers, Maxwell said.
The U.S. and EU are tackling similar broadband challenges, said FCC Office of Engineering and Technology Chief Julius Knapp. The FCC has taken steps to improve spectrum efficiency and get more spectrum into the pipeline, he said, and spectrum flexibility is a recurring theme. To make transitions easier, Knapp recommended avoiding categorization of mobile services. —