Intellect's response to Spectrum Liberalisation - a consultation on by j7djd923


									Intellect’s response to “Spectrum Liberalisation – a consultation on proposals to deduce or remove certain restrictions on spectrum use” issued
by Ofcom on 17th September 2004.

Submission due date : 12th November 2004
Actual submission date: 5th November 2004
Document Filename: ‘IntellectLiberalisationResponseDraftD-FINAL5Nov04.doc’
Document Status: non-confidential.
Intellect Contact Name:
Intellect Contact Phone Number: 07958-664516

Executive Summary

Intellect acknowledges the importance of spectrum trading and, in particular, regards spectrum liberalisation to be of very major significance in creating
societal benefits and opportunities for innovation and for new wireless services and applications. Combined, these two regulatory initiatives are welcome
tools and a considerable step forward in UK spectrum management policy. We agree that over time these could bring great benefits to the UK economy and
to our members, and in this context we continue to generally support these policies and also applaud the leadership being shown by Ofcom within the
European Union in spectrum management.

Intellect welcomes this latest consultation document from Ofcom which sets out details of how Spectrum Liberalisation will initially operate within the UK and
provides the opportunity to respond. Whilst, as stated above, Intellect members broadly support the direction that Ofcom is taking, we naturally have some
concerns and comments on certain details of the proposals which we now address in the answers to the questions posed in the document.

Some Intellect members felt that some of the proposals did not go far enough for the initial stage, whereas others were content with the scope and timetable
proposed. Generally speaking there is a broad consensus across our members that any variation to be introduced must be guided by sound spectrum
management principles combined with fair competition . We note that in the early stages, Ofcom is not explicitly allowing change of licence class, however
Intellect strongly welcomes Ofcom’s clear indications that it is open to suggestions from interested parties as to how further and/or more rapid liberalisation
could be facilitated. With this proviso, Intellect accepts that the present document provides a reasonable starting point without in any way ruling out more
innovative changes at an early stage should suitable proposals be made.

Intellect’s concerns, as detailed in the answers to the questions below, include the following key points:

    •   The proposal (para 3.27) that “Ofcom would not expect to allow bands not currently designated for 3G to change their use to offer 3G services
        before 2007”.

                                                                               Intellect, Russell Square House, 10-12 Russell Square, London WC1B 5EE
    •   Uncertainty over how broadcasting spectrum will be addressed, in particular how freed up analogue spectrum will be released and made available
        for reuse (e.g. by auction or by trading), and what degree of flexibility in usage is foreseen.
    •   The need for greater clarity on the technical proposals (section 4) in particular in relation to “spectrum quality” and “benchmark spectrum quality” and
        exactly how spectrum rights will be determined from existing equipment-based licences.
    •   Concern that the process for approving requests for license changes is not too burdensome, particularly the need to clarify the criteria for triggering
        consultation of adjacent licensees (para 6.14).
    •   Absence of any Ofcom performance targets for the timescales for responding to liberalisation requests.
    •   Possible lack of transparency if significant liberalisation approvals are not routinely published by Ofcom.

Intellect would be pleased to discuss the points made in this response in more detail if required and would urge Ofcom to take these views into account
when initial plans are finalized.

                                                                               Intellect, Russell Square House, 10-12 Russell Square, London WC1B 5EE
Detailed responses to the questions posed

Question 1:
What are your views on Ofcom’s general approach to introducing greater flexibility and, in particular, on the timing and phasing?


Intellect supports the approach being taken by Ofcom in pursuing new spectrum liberalisation policies within the UK. We consider that in general the initial
detailed proposals represent a cautious approach.. Consequently the opportunities they explicitly provide are somewhat limited in the early stages.
Nevertheless it is appreciated that Ofcom has tried to achieve a balance to address the interests of many stakeholders and it is understood that Ofcom
would in principle be willing to consider any specific proposals for changes that may run ahead of the preliminary timetable. The timetable towards the
liberalization of inter-class (and indeed service) variations needs to be outlined by Ofcom.


It is noted that the initial proposals do not yet allow changes between licence classes (e.g. Fixed P-P changing to P-MP, or P-MP systems changing to
mobile systems) in contrast with some current technological and market trends that point towards fixed/mobile convergence and flexible licensing policies.
Intellect does however recognize the benefit of restricting applications in certain bands for reasons of public benefit (e.g. WLANs in licence-exempt bands)
as well as for UK public policy reasons (e.g. Broadband delivery, emergency services etc.).

Special Measures for 3G

One issue for which Intellect is particularly interested in having clarification from Ofcom concerns the statement in para 3.27 that “Ofcom would not expect to
allow bands not currently designated for 3G to change their use to offer 3G services before 2007” . While we agree that a case can sometimes be made to
restrict a band to particular applications for public policy reasons, it would be difficult to justify the prevention of 3G or 3G-like service provision in other
spectrum as this would be a discriminatory measure.

Broadcast Spectrum

Intellect has a specific concern about the lack of clarity of how the broadcasting spectrum is to be addressed and how Ofcom’s plans in this area align with
the plans of the relevant Government departments. The spectrum trading statement made mention of the liberalisation of broadcasting spectrum use and
linkages to the analogue to digital switchover exercise. It is unclear to Intellect as to how the broadcasting spectrum liberalisation proposals relate to other
earlier government indications that broadcasting spectrum will be freed up for other purposes following digital switchover. For example, will freed up
spectrum be auctioned by Ofcom or will the mechanism be voluntary trading and liberalization by the existing licensees? Related questions arise such as
whether nationwide blocks of spectrum might be released, and how that would be achieved.

                                                                                Intellect, Russell Square House, 10-12 Russell Square, London WC1B 5EE
Licence Liberalisation Mechanisms

Intellect notes the two options of either liberalizing individual licenses or alternatively by changing licenses generically. The latter is particularly attractive
because it guarantees more predictability in the market place. Intellect is keen to reinforce the point that the guidance given per licence class be carefully
applied. It would be unfortunate if changes were to be rejected because the variation proposed didn't exactly line up with an example in the guidance.

Question 2:
  (a) What are your views on Ofcom’s proposals to base initial spectrum emission rights and quality benchmarks on existing licence
      conditions and assignment criteria? (b) Is there an alternative approach you would suggest and why?

Interference Analysis & Spectrum Quality Benchmarking

Intellect can agree in principle with the approach proposed however we have concerns over the lack of precision in what has been proposed so far and
whether Ofcom may be hindered by lack of suitable spectrum management tools to implement its plans. Ofcom may have to rely on technical proposals
brought forward by industry and give views on whether proposals are technically sound, rather than attempting to analyse proposals independently without
the necessary tools to do so within reasonable timescales. Intellect is particularly concerned that “benchmark spectrum quality” is not clearly defined. This
matter needs considerably more clarity and review with spectrum stakeholders and some clearly elaborated technical worked examples must be provided by
Ofcom for some reference scenarios.

Interference benchmark levels need to be carefully agreed to strike a balance between protecting services adequately, and not being unnecessarily
constraining so that the levels would prevent a potentially more valuable new service being deployed. The existing planning criteria in Ofcom documentation
are a reasonable starting point for discussions.

We agree that it is necessary to carefully consider interference from incumbent systems into new systems as well as the reverse when considering
liberalisation opportunities.

Intellect agrees with the principle of avoiding regulation on receivers. However, we strongly believe that OFCOM has a duty to the public to actively go out
to advise them of where the real problem lies in the event of functional failures brought about by poor receiver design.

Spectrum Rights

We note the proposal to have emission rights defined at the service area boundary. We would highlight the variability in radio propagation predictions and
emphasize that a predicted field strength level for providing service cannot simply be also used as the predicted interference level at the boundary. For the

                                                                                  Intellect, Russell Square House, 10-12 Russell Square, London WC1B 5EE
former purpose a best case (maximum path loss) propagation prediction may be appropriate, whereas for the latter purpose a worst case (minimum path
loss) prediction may be required.


Intellect considers that the requirement to provide technical data on the likely impact of a variation raises some issues. We believe Ofcom should only
require the minimum technical information necessary for the relevant decision to be taken. We would further caution that any move to have such technical
data provided by "recognised" authorities simply introduces unnecessary costs, complexity and time delays. We advocate no requirement for recognised
suppliers of such data. We believe this point to be important as to do otherwise could effectively limit the success of the spectrum market.

International Constraints

We consider that it will pay benefits if Ofcom reviews ALL current International Agreements and publishes the technical constraints that these may impose in
relation to spectrum liberalisation. This exercise should also aim to locate any conflicts between those agreements and the duty to ensure optimal use of the

Question 3:
Would you find it useful for Ofcom to publish monitoring data and what format and content would you find most helpful?

Monitoring data is an essential component of the successful implementation of spectrum trading. If it is used to locate under-utilised spectrum it advises
potential purchasers of spectrum of the likely vendors to investigate. Thus the main benefit is not looking for congestion but looking for under-utilisation.
Monitoring information could also be useful to fill in the gaps in licensing data and to verify the validity of license data held and its true utilization.

Monitoring data is a useful complement, but clearly not a substitute, for provision of data on spectrum utilization drawn from assignment databases.

                                                                               Intellect, Russell Square House, 10-12 Russell Square, London WC1B 5EE
Question 4:
(a) What are your views on Ofcom’s specific proposals for liberalisation in the licence classes discussed in this document and listed below?
    • PAMR
    • national paging
    • data networks
    • common base stations
    • PBR
    • FWA
    • point-to-point fixed links
    • scanning telemetry

Do you agree that these proposals are unlikely to be problematic from a spectrum management perspective? Do you see any other reasons
why Ofcom should not proceed with these proposals?
It would be helpful if you would comment specifically on the proposed approach to defining technical criteria for spectrum quality and on
whether they are likely to be sufficiently clear and robust.

As mentioned in part of our response to Question 1, we believe the specific proposals made in the document represent a cautious approach and
consequently limited opportunities. We see no reason why Ofcom should not proceed as proposed initially, but we would expect to see the proposals evolve
fairly rapidly to allow changes between applications and services according to market demand and in line with a general trend towards flexible licensing
policies. We note however that the existing users of the above services will need to be consulted. Some of them may have special needs.

On the technical criteria for spectrum quality please see our response to Question 2.

Question 5:
(a) What are your views on the proposals for dealing with requests for licence variations and for dealing with interference?
(b) Do you consider that they are reasonable, proportionate and will be effective in preventing harmful interference?

Ofcom Performance Metrics

Intellect is concerned that Ofcom does not indicate in this document that it will work to any open and transparent performance metrics in terms of the
timetable for responding to liberalisation requests, potentially creating considerable uncertainties for affected parties and allowing lengthy decision
timescales. Intellect believes that such metrics would be essential to a viable trading environment and may help focus resources within Ofcom in a dynamic
manner, depending on the volume and complexity of liberalisation requests that are made.

                                                                             Intellect, Russell Square House, 10-12 Russell Square, London WC1B 5EE
Transparency & Costs

Intellect is further concerned that there is no mention in the consultation document of an intention to routinely publish the decisions made by Ofcom in
relation to liberalisation requests. Such information would be useful in terms of known precedents to help guide subsequent licensees in knowing what may
be allowed so that effort is not wasted on schemes that would be unlikely to be allowed.

Intellect is content with cost recovery principles for activities which are genuinely necessary, however total costs must be controlled & minimised as provided
for in the Communications Act 2003, Clause 6 – ‘Duties to review regulatory burdens’.

Intellect notes that the document does not provide points of contact within Ofcom to discuss proposals relevant to each sector or liberalisation requests in


Intellect has a particular concern with the proposals in Para 6.14 of this consultation document concerning Ofcom’s intention to notify and consult parties
“affected” by the change including adjacent and co-channel licensees, businesses and consumers. Intellect believes that the circumstances under which
such consultation would be triggered needs to be clarified as there is potentially a huge cost to traders and such consultation should be carefully considered
in terms of risks rather than simply routinely carried out as a costly “precautionary” exercise. We also note that in 6.14 there is no MAXIMUM period in which
affected co-users must respond. In the extreme this could allow such a user to complain years after the system had been deployed, which could destroy the
certainty that will be needed to take advantage of the new regulatory regime.

Question 6:
Do you agree that, in the case of segmentation, the parties themselves should be responsible for resolving interference issues between them
(i.e. that do not affect third parties)?

Intellect is content with what Ofcom has proposed in relation to resolution of interference issues following license segmentation.

                                                   ---------End of Intellect’s Response ---------

                                                                                Intellect, Russell Square House, 10-12 Russell Square, London WC1B 5EE

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