Regulation threatens digital dividend
Digital dividend (DD) spectrum will be one of the most important drivers of LTE growth in the near term, but regulatory delays or poor rules could significantly hamper mobile broadband investments. In particular, as a new report indicates, regional harmonization can support optimal benefits from the new frequencies. Indeed, a centralized approach to managing the digital dividend spectrum could improve its impact on the European economy by €1bn to €3bn a year, according to the EU's Digital Agenda commissioner, Neelie Kroes.
Speaking at the Spectrum Management Conference in Brussels last week, Kroes said the European Union would gain the maximum benefits from the spectrum being freed up by transition to digital TV, if the region took a coordinated approach.
That would boost economies of scale for carriers, encouraging them to invest in networks which are regarded as important to boosting rural broadband services in Europe. The centralized approach would also boost roaming and allow for harmonized services and data rates. Kroes claims a central spectrum inventory would also boost harmonization efforts, and simplify the process of freeing up new frequencies, or of reallocating unused or underused blocks.
She called for every citizen to have data speeds of at least 30Mbps by 2020, a goal which the release of new spectrum will boost. However, although the European Commission aims to make at least 1,200MHz of spectrum available for mobile broadband by 2015, Kroes said many member states are still far away from achieving the target.
Some countries have auctioned LTE spectrum in one of the two main new 4G bands in the region (2.6-GHz and the 800-MHz dividend band), but only a few have sold licences in both, Germany being an important one. Other allocations, and refarming of 2G/3G spectrum, are under discussion in many areas.
“Sweden is already there; Denmark, Estonia, Germany and Latvia are there or are getting close. But 10 member states are not even halfway there,” Kroes complained. Similar themes are reported by spectrum analysts. Spectrum refarming, particularly in the former analog TV bands, should free an average of 300MHz of mobile spectrum worldwide by 2016, according to a new report by Maravedis-Rethink. However, the approach to new auctions will remain highly regionalized, and some areas will find themselves with non-mainstream band plans or delayed spectrum sales.
Such obstacles could reduce the investment in 4G equipment for the DD band by almost 11% in the period from 2012 to 2016 in a further blow to hard-pressed equipment makers. Although the US and some other countries have already released DD licences, few further auctions are expected outside Europe in the next two years because of regulatory delays.
The report shows that the EMEA region stands to gain 72MHz of spectrum from the DD during the period, as well as up to 220MHz of refarmed 900-MHz and 1.8-GHz frequencies. The Americas) will add 164MHz of DD capacity and could refarm up to 190MHz in the 2.6GHz band. Meanwhile, Asia will also free up 164MHz from the DD, plus up to 150MHz in refarmed 1.8GHz.
"Regional focus will continue to be a priority over global coordination in spectrum management. This will require additional efforts from regulators for a successful digital transition and digital dividend utilization," said report author Lester Garcia.
Although the DD is not the final answer to the spectrum shortage, its efficient use and implementation can help lessen the impacts of spectrum scarcity. The report outlines the best and worst cases in terms of the timely release of digital dividend spectrum. In the worst scenario, the lack of available DD spectrum for mobile broadband could slow down the growth in numbers of mobile broadband users by 6.3% by 2016. This reduction in subscriber uptake would reduce in-vestments in wireless infrastructure by 10.7%.
One of the major motivations for most authorities to release digital dividend spectrum in the 700-MHz or 800-MHz bands is to expand rural broadband coverage. This can be achieved at reduced cost with low frequency spectrum because it supports long range and good indoor penetration, but there are still significant cost/profit issues with delivering services to sparsely populated areas. Active antennas are one way to boost the business case, according to Ubidyne, an innovator in this space. CEO Michael Fraenkle said “new active antenna technology can be a game changer by significantly reducing both capex for network roll-out and opex for network operation costs.”
Ubidyne believes its Antenna Embedded Radio technology - which removes the need for bulky feeder cables, remote electrical tilt assemblies and additional amplifiers on masts – will be particularly applicable to the Asian market, though its current major trials are with a US carrier in the 700-MHz band. The firm's technology supports LTE in 700-MHz, GSM/3G/LTE in 900-MHz and in future there will be versions for the main European 4G bands, 800-MHz and 2.6-GHz.