On-going work in ITU-R Study Group 1 on market-based spectrum by sZU1tC

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									    Regional Seminar on Economic aspects of
     spectrum management for Arab States




On-going work in ITU-R Study Group 1 on
market-based spectrum management issues




         Mr Terry Jeacock (United Kingdom)
        Former Chairman ITU-R Study Group 1
      Former Co-chairman JG WTDC Resolution 9
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              Regional Seminar on Economic aspects of
               spectrum management for Arab States
“Licence-free”                                              “Command & Control”

(a.k.a. “the COMMONS”)
                                                             (a.k.a. “GOSPLAN” )

“Nobody knows best”                                         - “Government knows best”
                                        Future of
- No Legal Protection                                       - “first come, first served”
                                         national
- Technical Protection                  spectrum            - Beauty Contests
- High flexibility                     management           - Low flexibility
- Pro- “Innovation”                                         - Pro “Government”
                                          ??
- “Optimists”

               “Property Rights”                    Economists: “maximise value”

               (a.k.a. “the MARKET”)

               - “Market knows best”
               - Auctions/Secondary trading
               - High flexibility
               - Pro “Big Business”                                       Engineers: “avoid
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                                                                            interference”
         Regional Seminar on Economic aspects of
          spectrum management for Arab States
    SG 1 studies on market-based spectrum
                  management
Mechanisms to assist financing national spectrum management?
                                                                      
Additional tools to assist when demand exceeds supply?
                                                                      
Opportunities to decrease national regulation?
                                                                      
Mechanisms to increase flexibility to respond quickly to market
needs?                                                                
A “Spectrum Tax” to raise revenue for the government?
                                                                      
A complete replacement for “traditional” spectrum management?
                                                                      
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       Regional Seminar on Economic aspects of
        spectrum management for Arab States

               Scope of Study Group 1
             (relevant to this workshop):

• Development of principles and techniques for effective
  spectrum management;
• Sharing criteria and methods;
• Techniques for spectrum monitoring and long-term
  strategies for spectrum utilization and economic
  approaches to national spectrum management;
• Assistance in matters within its competence to developing
  countries in cooperation with the Telecommunication
  Development Sector.

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         Regional Seminar on Economic aspects of
          spectrum management for Arab States

         Work programme of Study Group 1
            (relevant to this workshop):

•   Spectrum economics
•   Alternative methods of national spectrum management
•   Increased flexibility in spectrum allocation
•   Role and task of radio monitoring in a liberal environment
•   In co-operation with ITU-D SG2: development of the
    “Spectrum Fees” database in accordance with WTDC-02
    Resolution 9 and Question 21/2



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         Regional Seminar on Economic aspects of
          spectrum management for Arab States
               Key Questions under study:
• Q.206: Strategies for economic approaches to national spectrum
  management and their financing;
• Q.207: Assessment, for spectrum planning and strategic
  development, of the benefits arising from the use of the radio
  spectrum;
• Q.208: Alternative methods of national spectrum management;
• Q.216: Spectrum redeployment as a method of national spectrum
  management;
• “Flexible” spectrum use:
      - Q.224: Technical convergence (for WRC-10),
      - Q.229: International regulatory framework (for WRC-07)
• ITU-D Q.21/2: Calculation of Spectrum Fees
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        Regional Seminar on Economic aspects of
         spectrum management for Arab States
           Results of studies:
       ITU-R Report SM.2012-1
Economic aspects of spectrum management
• Consists of five Chapters which describe the different
  economic approaches for spectrum management activities;
• Includes case studies on administrations’ experience
  regarding the economic aspects of spectrum management;
• intended for the use by administrations of both developing
  and developed countries in their development of strategies
  on economic approaches to national spectrum management
  and to the financing of this activity;
• analysis of the benefits of strategic development and the
  methods of technical support for national spectrum
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  management.
          Regional Seminar on Economic aspects of
           spectrum management for Arab States
              ITU-R Report SM.2012-1:
   Strategies for economic approaches to national spectrum
                management and their financing
Spectrum pricing
•Provides transparency in national assignment;
•Discourages spectrum stockpiling and hoarding;
•Provides an incentive for spectrum refarming;
•Method to quickly assign spectrum when there is a high level of
competition and demand;
Approaches
•Spectrum fees: Incentive, Opportunity Cost
    - based on actual spectrum use and estimated market value
•Auctions
    -Market forces fully determine the value of the spectrum 8
        Regional Seminar on Economic aspects of
         spectrum management for Arab States
         ITU-R Report SM.2012-1:
    Spectrum Rights and Spectrum Trading
As a consequence of Spectrum Pricing, need to consider:
Spectrum Rights obtained by the licencee:
•Definition of what the licencee may use the spectrum for,
•Protection from interference etc..
Spectrum Rights retained by the administration:
•All international obligations
                               and
Spectrum Trading
•Trade all or part of the spectrum associated with the licence
•Transferrable spectrum rights.
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         Regional Seminar on Economic aspects of
          spectrum management for Arab States
              ITU-R Report SM.2012-1:
Assessment, for spectrum planning and strategic development
  purposes, of the benefits arising from the use of the radio
                           spectrum

Requirement for assessment
• Assessment of the economic benefits are useful in making spectrum
  planning decisions and in the comparison of different options
• Quantification of these benefits is required for spectrum planning and
  strategic development
Methods
• gross domestic product (GDP) and employment;
• consumer and producer surplus.


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          Regional Seminar on Economic aspects of
           spectrum management for Arab States

              ITU-R Report SM.2012-1:
    Alternative methods of national spectrum management
    As consequence of market based approaches,
    administrations should consider options and
    requirements to transfer spectrum management
    resonsibility to (e.g.):
•   communication groups with a direct interest in spectrum
    such as advisory committees, trade associations;
•   professional organizations, and quasi-governmental
    associations;
•   frequency coordinators (and coordination groups) and
    designated spectrum managers; and
•   spectrum management consultants, and support contractors.
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           Regional Seminar on Economic aspects of
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     Results of studies:Recommendation SM.1603
 “Spectrum redeployment “refarming” as a method of
          national spectrum management”
Definition:
“A combination of administrative, financial and technical measures
aimed at removing users or equipment of the existing frequency
assignments either completely or partially from a particular
frequency band. The frequency band may then be allocated to the
same or different service(s). These measures may be implemented
in short, medium or long time-scales.”
Contents:
An analysis of the requirements, methods, costs, funding and
compensation arrangements, potential problems. A case study.   12
           Regional Seminar on Economic aspects of
            spectrum management for Arab States

     “Flexible” spectrum allocation?
• Likely requirement of spectrum trading because: the less
  restrictions on applications that can use a spectrum range, the
  greater its value;
• Opportunities to apply RR No. 4.4 ?
• But no protection rights and non-interference obligations = less
  value, especially in border areas;
• Broader Service definitions in RR?
• Improved methods for co-ordination between Services with
  dissimilar technical characteristics?
• Must maintain administrations’ rights and equitable spectrum
  access principles.
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        Regional Seminar on Economic aspects of
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Results of studies: Flexible spectrum allocation

 Approved Recommendations:
 • SM.1133: Spectrum utilization of broadly defined
   services
 • SM.1265-1: National alternative allocation
   methods
 In preparation:
 • Report to WRC-07: International regulatory framework
 • Report to WRC-10: Technical convergence (mobile, fixed
   broadcasting)                                         14
      Regional Seminar on Economic aspects of
       spectrum management for Arab States

     Role and task of radio monitoring
          in a liberal environment

• Q.225: Inspection of radio stations to verify
  compliance with license parameters
• Q.215: Monitoring of the radio coverage of
  land mobile networks to verify compliance
  with a given license


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        Regional Seminar on Economic aspects of
         spectrum management for Arab States

        WTDC-02 Resolution 9 and
Question 21/2 “Calculation of frequency fees”
 • Study: Analysis of the various principles,
   methods, formulas and approaches used by
   administrations for calculating spectrum use fees;
 • Output: An electronic document structure and
   links enabling users to have easy access to data on
   frequency fee calculation formulas for the users of
   the radio frequency spectrum in different
   countries;
 • Output: Case studies and examples of use.
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Regional Seminar on Economic aspects of
 spectrum management for Arab States
 Spectrum Fees Data Base: Query screen




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          Regional Seminar on Economic aspects of
           spectrum management for Arab States




Formula: K1*K2*(Total Frequency Band / 25 KHZ)*1 896.30 €
K1=frequency band coefficient: 1 = below 470 MHz, 0.8=470-960 MHz etc…..
K2=geographic coverage coefficient: actual coverage area / total area of country 18
             Regional Seminar on Economic aspects of
              spectrum management for Arab States

       Handbook on National Spectrum
               Management
                          Chapter 6: Spectrum Economics
                          (Written to be low on theory, high on practice!)
                          • Spectrum licencing approaches
                          • Spectrum pricing
                          • Spectrum rights
                          Annex 1: An application of spectrum pricing
                          Annex 2: Cost of spectrum redeployment

Cost of Handbook 73 CHF
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           Regional Seminar on Economic aspects of
            spectrum management for Arab States

                             Finally
              Thank you for your attention!



Terry Jeacock has retired from the UK Administration and is attending this
Workshop as an independent expert. He does not represent Ofcom, the United
Kingdom or the ITU. He has resigned his ITU chairmanships. The information
presented has been obtained from publicly available sources, including:
ITU (Study Group 1) (www.itu.int/ITU-R/study-groups/rsg1/index.asp)
European thematic portal (europa.eu.int/information_society)
European Radiocommunication Office (www.ero.dk)
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