Radio Spectrum the EBU Q&A

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2 Radio Spectrum the EBU Q&A What is spectrum and what is it used for? Spectrum or radio spectrum is the range of electromagnetic radio frequencies used to transmit signals wirelessly. Radio frequencies are allocated for different types of use: radio, television, mobile telecommunications, Wi-Fi and some specific communications e.g. wireless microphones, satellites, radars or the military. The frequencies range from 9 kilohertz (khz) to 3000 gigahertz (GHz). Spectrum is split into different parts that are then allocated to one or more services (shared spectrum). Each of these services is typically licensed for use by one or more operators (e.g. broadcasting companies or mobile network operators that transmit in a given piece of spectrum). How is spectrum use split and allocated? Spectrum is a finite resource that must be allocated in a balanced and efficient way for various uses. Generally speaking, the allocation is specific, i.e. for TV, mobile devices, Wi-Fi, etc. based on the demand and the technical properties of the radio frequencies. Terrestrial broadcasting, for example, works best on UHF band frequencies ( MHz). An excessive shift in this balance in favour of one service can lead to serious disruptions in other services. Why is spectrum allocation on the political agenda? Though spectrum is mainly dealt with by specialized technicians, the way it is allocated is currently a political issue because, with more and more ways of using wireless signals, spectrum is becoming a scarcer resource. Major spectrum stakeholders broadcasters and mobile network operators in particular are struggling to find a win-win solution for the future of the UHF band ( MHz). Broadcasters rely almost exclusively on the UHF band to transmit TV content. As broadcasters have switched from analogue to digital TV, which resulted in significant gains in spectrum efficiency for TV channel delivery, they were able to free up the 800 MHz frequency, which is now being used by the mobile sector. But mobile network operators remain extremely vocal in their calls for more radio spectrum. Mobile operators are now exerting increasing pressure to open up the 700 MHz part of the UHF band for mobile use, claiming that the capacity required for 3G and 4G networks will increase dramatically in the near future. However, there is already around 1000 MHz of spectrum allocated to the mobile service without the 2

3 700 MHz band and large parts of this spectrum are not used. This prompts the question of why more spectrum should be allocated to mobile network operators if they are not using all of the spectrum already available to them? The 700 MHz band is 30% of the spectrum remaining for terrestrial TV on the UHF Band. Allocating it to mobile network operators would have undesirable consequences for TV audiences, such as a major reduction in channels and a degradation of viewing quality. It would also reduce incentives for innovation in the broadcasting sector: there would be no sense in developing programmes in 3D or ultra-high definition if the necessary infrastructure to broadcast them were not available, even if most living rooms were equipped for 3D TV or UHDTV. Why has the European Commission set up a special stakeholder group? The European Commission set up a High Level Group of Experts to come forward with recommendations on the future allocation of the 700 MHz band. Former European Commissioner and WTO chief Pascal Lamy chairs the group and presented its recommendations in early September. Though national administrations have the final say on how spectrum should be allocated on their territory, these recommendations will feed into broader spectrum policy discussions in the EU and the ITU, in particular the EU s position in global negotiations on spectrum allocation at the ITU in 2015 and the new EU Radio Spectrum Policy Programme expected in late What are broadcasters bringing to this policy debate? The main concern for broadcasters is that they will lose a major part of an indispensable resource for their activities. They deplore that this debate is being caricatured as a choice between new and old, based on the flawed assumption that in the near future everyone will consume content exclusively on mobile devices and that traditional TV and radio broadcasting will be a thing of the past. Broadcasters firmly believe that TV will continue to be by far the most popular way to watch audiovisual content for the foreseeable future and that DTT will be the most popular TV platform. Figures on TV viewing and how TV is received at home clearly support this. The reality is that broadcasting will remain the most efficient way of delivering free-to-air content by TV or radio. This is one of the key roles of the public service media that the EBU represents. Conversely, the debate is being fuelled by claims from the telecoms industry on the extent to which mobile consumption is going to increase in the next six years or so. 3

4 These claims, broadcasters believe, are being used wrongly as the starting point for discussions on the future allocation of spectrum with a specific focus on the 700 MHz band which is essential for TV and radio broadcasting. However, this approach has the potential to backfire if a proper impact assessment is not made and that could have dramatic consequences for the future quality of TV and radio services in Europe. Broadcasters are highlighting that it is perfectly possible for mobile and broadcasting services to work smoothly alongside each other without opening up the 700 MHz band, and policymakers need to look at these other options. Why do broadcasters reject the idea that mobile internet will displace terrestrial TV? The rise of one technology does not necessarily mean the death of another. We all know that in the end video never did kill the radio star. The caricature of mobile viewing displacing TV does not reflect data consumption today or in the foreseeable future. For a start, TV use shows no sign of declining, with Europeans watching an average of almost four hours of television a day in Of the various TV platforms in Europe, DTT is the most popular, reaching 250 million viewers every day. It is irreplaceable in terms of meeting audience demand for the foreseeable future. Broadcasting remains the most efficient way of delivering free-to-air content by TV or radio, and there are roles that broadcast services play that simply cannot be filled by mobile. For example, broadcasting is irreplaceable for transmitting live events to mass audiences. In other words, one-to-many communications, as distinct from oneto-one mobile communications that focus on an individual link between a device (phone or tablet) and the content provider. If you imagine transmitting the World Cup Final to millions of people on a one-to-one basis, the viewing experience would be interrupted and congestion would be unavoidable. It is also important to put the split between TV and mobile consumption of video content into perspective. In Europe 95% of all video content is currently watched on TV 90% live and 5% via catch-up/on-demand TV. But this does not even mean that the remaining 5% is mobile. The vast majority is accessed via Wi-Fi in the home, with mobile viewing only accounting for 1% of total video consumption. This situation is not going to change in the near future. For example, live TV viewing will still account for over 80% of daily TV consumption in

5 But isn t there an irresistible demand for mobile internet? There is evidence that the figures for future mobile internet demand are somewhat exaggerated and are based on four major false premises. Firstly, they appear to completely ignore the role of Wi-Fi. Just because you have a smartphone or a tablet does not mean you are consuming mobile data. In fact, 8 out of 10 tablets sold in Europe are not even set up for mobile consumption. Most data is received on mobile devices via Wi-Fi and this will continue to be the case: a recent European Commission study found that 71% of all wireless data delivered to smartphones and tablets in the EU was via Wi-Fi and that this was likely to rise to 78% by For the consumer, Wi-Fi reception is cheaper, of better quality, and more reliable. Secondly, models for future consumption of mobile data are based on unrealistic population densities. A recent ITU report, effectively drafted by the telecoms industry, overestimates future mobile traffic density by a factor of 100 or more compared to realistic population densities in Thirdly, the 50-fold growth in data traffic by 2020 predicted by the telecoms industry does not make sense from an economic perspective. Crudely put, does this mean that average consumers will spend 50 times more on mobile data than they do today? Or will they be more inclined to consume much more mobile data because retail costs will become 50 times lower? The telecoms industry will argue that investment in innovation will mean that the cost will drop. But if costs to consumers do not increase, how will they have the revenue to invest in innovation? The numbers simply do not add up. Finally, it is unclear why the telecoms industry is demanding access to new spectrum bands when the uptake of re-allocated 800 MHz frequencies for mobile services has been slow. Telecom operators argue that they need access to 700 MHz to add to the already deployed 800 MHz to allow them to reach rural areas with mobile broadband services. But there is currently no evidence that the rollout of 800 MHz has reached rural areas and it is not economically viable to deploy such networks at present; there is no proof that such a roll-out would ever take place without substantial public subsidies. What would the consequences be for broadcasters if they lost the 700 MHz frequencies? This could have a dramatic impact on the future quality of TV and radio services in Europe. The direct consequence of opening up the 700 MHz frequencies to mobile usage would be to displace spectrum currently allocated for broadcast services. 5

6 The fact is that broadcast services rely almost exclusively on the UHF band and that the 700 MHz band is extensively used in most European countries, and there will continue to be strong demand for broadcast services. Before any decision on new spectrum allocations is taken, it is crucial to ensure that: - the spectrum already allocated to mobile services is being used efficiently; - the spectrum requirements claimed by the mobile industry are realistic, taking into account the technical and economic viability of the predicted market developments in the timeframe under discussion, e.g. up to 2020; - there is confidence that the incremental benefits to society of providing new spectrum for mobile use will outweigh the costs and inconvenience of displacing existing users. The EBU is not aware of any such analysis being carried out at EU or global level. This is why any discussion on the allocation of the UHF band needs to take account of current and future demand for bandwidth for all spectrum and evaluate current spectrum allocations for mobile broadband services and whether they are fit for purpose. Is there room for another solution? Solutions are possible that can effectively balance the demand for mobile and broadcast services, and take into account the real needs of European citizens instead of one industry sector. This is what policymakers should be focusing on. It is perfectly possible for mobile and broadcasting services to work smoothly alongside each other without opening up the 700 MHz band. Firstly, since the roll-out of commercial 4G LTE services in the 800 MHz band has been slow, calls for further spectrum for mobile services in 700 MHz is not justified. Spectrum already assigned to mobile broadband should be used to capacity before any new bands are opened up. Secondly, increased use of Wi-Fi should also ease demand for mobile spectrum. Finally, and most importantly, new demand for mobile services can also be met outside the UHF broadcasting band. Unlike broadcast services, mobile internet can also work on higher frequency ranges (800 MHz, 900 MHz, L-band, 1.8 GHz, 2.3 GHz, 2.6 GHz, 3.5 GHz). In a nutshell, the efficiency of mobile broadband spectrum should be maximized across all spectrum before the quality of TV and radio services is threatened with severe disruption. 6

7 What about the long-term future? Isn t this simply postponing the inevitable? Terrestrial TV broadcasting is the single most popular way of delivering a live event to millions and will remain so as long as sufficient spectrum is available. Broadcasters ultimately want to ensure the World Cup Final is just as easy to watch in 2022 as in 2014, if not easier and better thanks to new technologies. With Ultra HDTV now entering the mainstream, the next breakthroughs towards the perfect picture are just around the corner

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