Huawei exec warns governments to stop cashing in on spectrum

A Huawei executive wants the world's governments to stop considering wireless spectrum to be "an asset to be maximized for cash" and instead take a healthier view of radio frequencies as an enabler of social and economic development.

Ryan Ding, a senior Huawei executive, told attendees of the Mobile Asia Expo in Shanghai, China, that many governments and policymakers wrongly view spectrum as a cash cow rather than acknowledging its role as a driver of social and economic progress.

"Wireless spectrum is fuelling the digital revolution, but it's a scarce commodity and demand rises with every new generation of technology and additional users," he said. "A significant gap exists today between the spectrum that's currently available and estimated future demand."

Ding cited the Asian nations of China, Japan and South Korea, whose telecom authorities he contends are setting spectrum policies designed to encourage investment and take-up. He observed, as have many industry pundits before him, that Europe is struggling to catch up on LTE deployments because operators there were burdened by massive payments for 3G spectrum. That money has gone into government coffers rather than being invested in next-generation technologies.

"European operators that invested heavily in 3G spectrum less than ten years ago were slow to commit to new 4G investment while still recouping their 3G investments," Ding said. "This overlapping investment challenge is one of the key reasons Europe lost is leadership in mobile networks to the U.S. and parts of Asia with the arrival of 4G."

His comments echoed those of Anne Bouverot, the GSMA director general, who addressed similar issues during a keynote session at the TM Forum Live conference earlier this month in Nice, France. She said Europe has been playing catch-up with markets such as the U.S. and Asia on 4G partly because 3G-spectrum auctions burdened the sector with so much debt. Europe accounts for only 3 percent of LTE subscribers globally, she noted.

Ericsson (NASDAQ: ERIC) recently said in its latest Mobility Report that it expects the North American market, the company's largest by sales, to continue as the leader in LTE subscriptions for the next several years.

Ding's comments actually come at a crucial time for U.S. mobile operators, as they ponder their strategies for bidding in two upcoming spectrum auctions: the November auction of AWS-3 spectrum and next year's 600 MHz incentive auction of TV broadcast spectrum.

The Huawei executive's remarks may reflect the Chinese vendor's intent to gain influence on spectrum policy within Europe as it makes considerable investments and builds partnerships with companies and academia in the region. Company CEO Ren Zhengfei has said that Huawei's mission is to ensure that in a few years, "people perceive Huawei as a European company."

Ding cited research that has shown that every 10 percent increase in broadband penetration boosts national gross domestic product (GDP) 1.3 percent and employment rates between 2 and 3 percent. "Industrial production efficiency is also boosted by between five and twenty percent, while innovation efficiency in a better-connected environment can be better by a factor of fifteen times," he added.

For more:
- see this Huawei release

Related articles:
Let's make the most of 4G before rushing to 5G, says GSMA's Bouverot
Ericsson: North America to dominate LTE subscriptions through 2019
Ericsson CTO claims North America is driving 5G development
Huawei repositioning as a 'European' company

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