Sharing digital dividend could give France €25bn boost

France is the centre of an increasingly heated debate over how best to reallocate spectrum that is currently being used for analogue broadcasting. By 2012, the switch-over from analogue to digital television in France will have freed up a significant amount of ultra high frequency (UHF) spectrum. This spectrum will then be reallocated, generating what has become known as the 'digital dividend'. This spectrum, located at frequencies below 1GHz, is especially valuable as it allows the delivery of services with unique coverage and penetration qualities.

The French telecoms regulator ARCEP commissioned Analysys (now Analysys Mason and Hogan & Hartson at the beginning of 2008 to study and report on the optimum framework for releasing available spectrum to the market in a way that maximises benefits for the economy and society over time.

Key findings of the report include:

"¢ allocating a proportion of the released spectrum for mobile broadband services adds greater value to the economy than if this band were allocated exclusively to digital TV services. In fact, a scenario that would 'share' the digital dividend between both electronic communications and audiovisual industries would add over €25 billion more to the French economy between 2012 and 2024 than allocating the digital dividend exclusively to the digital TV industry.

"¢ mobile broadband services will support political goals of 'digital inclusion'. Expanding mobile broadband access, especially in areas that will be underserved by fibre, will be most economically productive, and will significantly reduce the digital divide. Allocation of spectrum to mobile broadband will support the French government's aim of ensuring 100% of the French population has access to fixed/mobile broadband Internet by 2012.

"¢ it is vital that a detailed framework for the process of reallocating the digital dividend spectrum is established as soon as possible. France is not the only country that stands to benefit from a digital dividend. Negotiations with neighbouring countries (notably with regard to pan-European services and interference) are central to ensuring that the spectrum can be used to best effect, allowing the digital dividend to be exploited to its maximum potential, and supporting the successful launch of new services and technologies. European governments and regulators must provide clear signals to the market as to how spectrum within the UHF band will be released.

"¢ our comparison of the approach taken in other countries shows widespread international support for the sharing of digital-dividend spectrum. The countries studied are allocating, or planning to allocate, the digital-dividend spectrum to both increase capacity for digital terrestrial television (DTT) and to provide mobile broadband services.

Our economic valuation is based on credible scenarios for the reallocation of the released spectrum, as discussed with both telecoms and television players. The aim of this valuation is to inform the government's decision on how best to allocate the digital dividend.

It's like discovering 100 hectares of prime real estate in the middle of Paris, there is enough new spectrum there to satisfy everyone. But the French government needs to make planning decisions now for French citizens to benefit fully from this resource in 2012.

The study for ARCEP focused on the French law of 5 March 2007, which establishes guidelines on how the digital dividend should be shared in France. The study then compares the French situation to that in several other OECD countries.


It builds upon our extensive work on spectrum-related issues, including a study undertaken by Analysys on the digital dividend for UK regulator Ofcom in 2006.

This Ofcom report included an economic and technical analysis of alternative uses of the radio spectrum released by the switch to all-digital television broadcasting, as well as recommendations on how Ofcom should allocate the released spectrum

Laurent Zenou, Head of Paris office, Analysys Mason