Digital switchover spectrum worth €200 billion - Reding

It looks like Viviane Reding is alive and kicking at the European Commission after being nominated for another five year term and issuing her customary rallying call to governments and the telecom industry to move faster down the path of liberalisation.

Less than a month after the UK government released it's Digital Britain report restating it's ambition to complete the digital switchover from analogue TV by 2012, Reding has urged European government's to bring forward plans and not wait until 2012. What's more, Reding reckons the EU-wide switchover would increase the value of spectrum by between €150 billion and €200 billion.

That's a hefty sum, although just how much operators are able and/or willing to pay for spectrum right now is a different matter. Indeed, the tone coming out of the Digital Britain report was far more about maximising coverage rather than maximising the monies generated by any spectrum auctions... which when you consider the still poor 3G coverage in the UK, is probably a sensible move.

Digital Britain - what it means for mobile operators

Yesterday's publication of the Digital Britain report has predictably been met with headlines about the imposition of a broadband ‘levy’ (or ‘tax’ to you and me) to help fund the future investment in a national high speed internet infrastructure. But, as the appointment of Martha Lane Fox as ‘Digital Inclusion Champion’ perhaps mischievously suggests, is this all a little bit of a lastminute strategy?

There are some interesting points contained within the report (Martha's appointment not being one of them!), not least the news that ISPs are going to be made responsible for policing their own subscribers. This is maybe not such good news for the ISPs, but for anyone selling DPI-related products, it can only be a good thing ... but more on this in a later post.

One area that hasn't received much attention thus far has been what it had to say about mobile networks. There has been some moaning that mobile is just being seen as a stop-gap solution until fixed networks can sort themselves out and deliver the requisite speeds (a heady 2Mbps) to the more remote, broadband-deprived parts of the country. However, I think that's a bit harsh, to be honest.

The report not only acknowledges that next generation mobile networks will be able to deliver data rates of up to 100Mbps, but clearly says that both 3G and LTE have a key role to play in delivering the goal of universal broadband coverage.

What is of perhaps more significance though is:

• WiMAX is essentially dead in the UK. While it advocates "the immediate release of WiMAX-suitable 2.6Ghz unpaired TDD spectrum for auction", the reports lays its cards on the table and states that there is "an encouraging consensus amongst incumbent mobile operators for the mobile broadband networks to be based on either 3G or LTE. This does not preclude a new entrant using other technologies, such as WiMAX, but in the highly competitive UK mobile radio market it is highly unlikely that such a new entrant would have the market power to de-stabilise the vital standardisation that underpins national and international mobile roaming for UK users."

• The 'Big Auction' for 2.6Ghz paired FDD spectrum (i.e. the spectrum for LTE) is set for mid-2010. But, there is still a big debate to be had over spectrum refarming before this can happen. Essentially, if Vodafone or O2 (who occcupy 900Mhz spectrum for their GSM services) want any 800Mhz spectrum for future mobile broadband services they will have to trade in their 2G spectrum. The reason, simply, is that the economic advantages of 900Mhz over 1800Mhz (greater cell coverage etc.) are such that the regulator has to balance it out so T-Mo and Orange aren't penalised. So the auction of 800Mhz and deployment of LTE rests on how easily 900Mhz can be refarmed.
  

• In a bid to drive universal mobile broadband coverage and so get 3G services as nationwide as 2G, the terms of the 3G licences are going to change from time limited to indefinite in order to give operators a chance to see an ROI from extending their 3G coverage. What's more, the Digital Britain report seems to favour network sharing in the sub-1Ghz spectrum as a way of expediting this network expansion, not least because lowering the cost of delivering broadband coverage to the last 10% of the UK is critical given that they are so well dispersed and "not a viable market" on their own.
  

Overall, the Digital Britain report seems positive for mobile operators. I've heard murmurings of people saying LTE could solve all the problems and so we wouldn't need to pay the 'broadband tax' to bankroll building a nationwide high speed fixed network, but realistically this was never going to be the case. Any anyway, the economics of delivering mobile broadband in remote areas is still something that needs help from the regulator to balance.

Either way, with several important spectrum issues to be resolved over the next 12 months, it's clear that there is still much to play for in the role mobile networks will have in policies to finally deliver a universal high speed internet in the UK.

Is Broadband a Utilty - the conclusion?

As Lord Carter prepares to unveil his Digital Britain report today, Gordon Brown has already gone on the record in The Times stating that the internet is a"as vital as water and gas".

Watch this space for an analysis on the Digital Britain report once it's published, but in the interim, check out the story so far on whether broadband should be considered a utility:

Part 1: OFCOM opens the door

Part 2: Lessons from Australia

Part 3: Open Access?

Part 4: Consumer survey by OFCOM

Is broadband a utility? (part 4) - UK consumers say "Yes"

For a while now I've been banging on about whether Broadband should be considered a 'utility', particularly in light of the decision by the Australian Government to invest in building a 'National Broadband Network'. Well, it seems as if we finally have an answer ... Yes, it should be.

A survey by OFCOM's Communications Consumer Panel has found that 73% of those questioned described a high-speed connection as important, even ranking it above a mobile phone in their list of necessities on the basis that people who did not have broadband would be at a disadvantage, missing out on services such as shopping, banking and public services as they were increasingly being delivered online.

According to Anna Bradley, the chair of the Communications Consumer Panel: "The key message is that people think broadband is at a tipping point. It's fantastically useful for everyone, essential for some now, but will be essential for everyone in the near future. It is being compared by consumers to gas and electricity - things which they think we all ought to have access to, almost as a right."

Consumers questioned in the survey supported broadband access for all and said that:

• It should be possible to have broadband at home, regardless of where people live (84% agree, 46% agree strongly).
• It is everyone's right to be able to have broadband at home (81% agree, 42% agree strongly).
• It should be possible also for people to gain the confidence and skills to make full use of broadband at home (80% agree, 32% agree strongly).
• It should be possible to access broadband at home, even if they have a low income (73% agree, 32% agree strongly).
  

But, if we do indeed consider broadband to be a utility that should be available to all, the UK has some way to go both compared to its peers internationally but also domestically.

While Lord Carter in his interim recommendations for Digital Britain, has proposed a Universal Service for broadband, with a recommended 2Mbps which the government has backed, the reality is that much of the UK remains disconnected.

According to research commissioned by the BBC, about three million homes in the UK have broadband speeds of less than the magic 2Mbps. What's more, the physical distance of many homes from the local exchange mean it is practically impossible for them to get anywhere nears this speed.

The map of these so-called Broadband NotSpots put the scale of the problem in context (check out ThinkBroadband and SamKnows for their NotSpot maps).

As soon as you drop below the 2Mbps, the access to content and services drops off dramatically ... heck, you won't even be able to watch the re-run of the Apprentice on iPlayer ... it's THAT bad.