The Benefits of Technology-Neutral Spectrum Licences
In many countries the process of introducing new technology in existing frequency bands is delayed because spectrum is not licensed on a technology-neutral basis. Indeed some countries have not learned the lesson from a delayed introduction of 3G and 4G and are now repeating the same mistake for 5G.
Related insights
Technology-neutral spectrum licensing assigns spectrum to mobile operators without specifying the technology. It enables them to shift spectrum from GSM or 3G to 4G and 5G based on market demand. This maximises spectral efficiency and spectrum use, leading to improved mobile broadband coverage, faster data speeds, and lower data prices for users.
A Limited Resource
Spectrum, a limited resource, requires efficient management in line with best practice. 4G’s efficiency with MIMO allows for significant data capacity boosts when shifting spectrum from 2G. Transitioning from GSM to 4G in certain spectrums can offer up to 26 times improvement in bits/Hz. Regulators focusing on efficient spectrum use should consider these facts when setting mobile spectrum policies.
4G’s higher efficiency compared to older technologies is crucial for a connected society. Empirical evidence shows economic gains from adopting 4G mobile broadband.
- “For a given level of total mobile penetration a 10 per cent substitution from 2G to 3G increases per capita GDP by 0.15 percentage points … A doubling of mobile data use leads to an increase in the GDP per capita growth rate of 0.5 percentage points.” (Source: The Impact of Mobile Telephony on Economic Growth, Deloitte, 2012)
- “Doubling the broadband speed will contribute to 0.3% growth compared with the growth rate in the base year”. (Source: Does broadband speed really matter for driving economic growth? Rohman et al, Division of Technology and Society, Department of Technology Management and Economics Chalmers University of Technology, Gothenburg, Sweden, 2012)
The Year Ahead
2019 will witness a surge in 5G commercial launches. Mobile operators need flexibility to repurpose existing spectrum for 5G, especially for coverage, even if originally licensed for 4G. Regulators can ensure smooth transitions between technologies, allowing for simultaneous use of bands for 4G and 5G, supporting both newer and legacy users.
The IoT market is rapidly growing, demanding technology-neutral spectrum licences for specialised networks. Regulators should adopt neutral frameworks to avoid hindering IoT’s development, vital for the ongoing industrial revolution.
Some countries still issue technology-specific spectrum licenses, affecting consumers and businesses with subpar mobile broadband experiences and potential higher costs.
4G deployment has upped data traffic, requiring Gbit/s range backhaul links from mobile stations. Microwave spectrum licensing needs to evolve to accommodate these demands, allowing operators to adopt the latest technology without capacity-based fee structures hindering Gbit backhaul deployment.
Other insights
The Polish 700 and 800 MHz Spectrum Auction: Insights and Global Lessons
Poland’s final low-band spectrum auction marks a pivotal moment in Europe’s 5G rollout, offering key lessons in auction design, cross-border coordination, and strategic spectrum management.
The Case for Strategic Spectrum Renewal
As spectrum licences approach their expiry date, a strategic approach to spectrum renewal is crucial. Traditional presumption of renewal in favour of incumbents may no longer serve the industry’s needs. Instead, a more strategic approach to renewal can optimise spectrum assignments and improve spectral efficiency by up to 40%.
Best Practice Spectrum Management
The principles of best practice spectrum management are well established and their implementation can enhance the socio-economic value of spectrum and how much operators are prepared to pay to acquire new spectrum. Whilst most regulators in developed markets have adopted best practice, the same cannot be said for developing markets. Coleago recently studied the regulatory environments in 16 African markets and recorded the extent to which best practice had been adopted.
Learning From Best Practice Spectrum Management in Botswana
The Botswana Communications Regulatory Authority conducted a review of its spectrum management strategy to align with international best practice. The Authority was advised by Coleago and in this paper, Project Director Graham Friend highlights the lessons to be learned for other regulators in developing markets.
The End of Telecoms History? – Not Quite!
At the European 5G conference, Stefan Zehle highlighted that differences in mobile data usage across countries result from variations in price and network availability. While European policymakers celebrate 89% 5G coverage, gaps in both outdoor and indoor connectivity limit usage. William Webb’s prediction that data traffic will plateau at 20 GB per user per month by 2027 seems unlikely, given that top users already exceed 100 GB. To fully realise 5G’s potential, policymakers must address these coverage issues in a cost-effective manner.
Insights from a Strategic Spectrum Review
The mobile industry has accumulated a fragmented spectrum portfolio, consisting of various frequency bands that are sub-optimally allocated for modern technologies like 4G and 5G. As operators transition from legacy technologies such as 2G and 3G to newer, bandwidth-intensive solutions, the need for contiguous spectrum blocks has become critical.
