The award of available spectrum: 1452-1492 MHz

Introduction

Introduction

1.1 Ofcom, in March 2006, consulted on its proposals for the award of available spectrum in the 1452 – 1492 MHz frequency band ^(-1-). In that consultation document, Ofcom set out a number of factors relevant to the spectrum award.

1.2 Following that consultation, in order to address some of the issues raised by respondents, on 15 February 2007 Ofcom published two discussion documents relating to the award of the 1452-1492 MHz band. One document addressed aspects of the auction design and the other considered aspects of the technical licence conditions.

1.3 The “Discussion document on the award of available spectrum 1452 – 1492 MHz: Auction design” ^(-2-) proposed rules for a combinatorial auction design for the LBand award. The purpose of the document was to explain the key features of the combinatorial clock auction format and set out how such an auction format may be expected to work in practice. It also summarised the two auction formats set out in the consultation document and compared these with the combinatorial clock auction format.

1.4 In the “Discussion document on the award of available spectrum 1452 – 1492 MHz: Technical aspects” ^(-3-) Ofcom laid out a number of alternative approaches to the technical conditions associated with the award of the 1452 – 1479.5 MHz sub band. The revised technical conditions proposed in the document were designed to give the market greater certainty while not unduly inhibiting alternative technologies.

1.5 Specifically the technical conditions document put forward for consultation four proposals.

• Proposal 1 – A spectrum mask approach based on an augmented Maastricht mask, as referred to in the consultation document.
• Proposal 2 – A spectrum mask approach based on the European Telecommunications Standards Institute (ETSI) critical mask
• Proposal 3 – A Spectrum Usage Rights (SURs) approach based on an augmented Maastricht mask
• Proposal 4 – A SURs approach based on the ETSI critical mask

Developments since the consultations

1.6 The consultation on these discussion documents closed on 12 April 2007 and the full non-confidential consultation responses are available on the Ofcom website, however some of the points arising from the responses are summarised below.

1.7 Most respondents to the auction design consultation supported the combinatorial clock auction, although some indicated that they wanted more detail about the auction design. Some respondents also suggested that Ofcom should look for ways to ensure that different network designs were co-ordinated through the auction.

1.8 Reponses to the consultation on the technical aspects were mixed with the general view that the ETSI critical mask was preferred to the Maastricht mask. However views were split between whether the SURs or the spectrum mask approach should be followed.

1.9 The most common issue raised by respondents was that there still was not enough certainty about adjacent users, particularly as to how high and low power networks would co-exist, and therefore there was a significant risk of Adjacent Channel Interference (ACI), and uncertainty over the ability to use coordination measures successfully.

1.10 Given that material concerns still appear to exist Ofcom has again considered what can be done to address those issues. In order to do that this document makes proposals in two areas; firstly revised technical conditions and secondly modifications to the proposed auction design.

1.11 The proposed revised technical conditions consist of two types of licence for the sub-band, split by a guard band, one for high power-low density network deployments and the other for low power-high density network deployments:

• an SUR derived with values appropriate for indoor, portable, mobile multimedia services and operating in line with the ETSI critical mask. Additionally a restriction on the maximum density of transmitters is proposed, limiting use to high power, low density networks.
• a second SUR, based on the same parameters. Additionally an upper limit on the Equivalent Isotropically Radiated Power (EIRP) of transmitters deployed in the network is proposed, limiting use to lower power, higher density networks.

1.12 The modified auction design is a combinatorial clock auction format that allows successful bidders to guarantee through the auction that they are adjacent to either:

• the top or the bottom of the band; or
• users who want to roll out a similar network to their own i.e. either high power-low density or a low power-high density; or
• a guard band of 2 lots (3.4 MHz) between high power-low density and low power-high density networks

1.13 This combination of technical conditions and auction design will give users greater certainty about the potential for interference from the networks of adjacent users. Under this approach, the market could either choose an outcome that allows a single usage right to cover the entire band (and in this case there will be no guard band) or an outcome where different network designs co-exist.

1.14 As before, much of the content of this discussion document relating to auction design is based on work that has been commissioned by Ofcom from DotEcon and Professor Peter Cramton.

1.15 In addition concerns have been raised regarding possible inefficient hoarding of spectrum in this band. Ofcom has considered the issues relating to this but considers that it would not be appropriate to include a licence condition that relates to inefficient hoarding in the 1452-1492 MHz licences.

International developments

1.16 Following the Electronic Communications Committee (ECC) meeting on 2-4 July 2007 32 administrations have agreed and signed a partial revision to the Maastricht 2002 Special Arrangement (MA02). This includes the majority of the Member States of the European Union including the UK and all of the UK’s near neighbours.

1.17 In general terms the partial revision of MA02 allows additional flexibility for administrations to use the 1452-1479.5 MHz band. In particular it supports:

• the application of an envelope concept i.e. that the plan entries in MA02 could be used for terrestrial mobile multimedia services with characteristics that may be different from those appearing in the Plan but within the envelope of their T-DAB Plan entry; and
• the aggregation of the blocks to accommodate mobile multimedia services with wider bandwidths than T-DAB.

1.18 The European Commission (EC) is considering making a binding decision to harmonise the use of the 1452-1479.5 MHz band. It is not planning to make the decision before the October 2007 meeting of the Radio Spectrum Committee (RSC) scheduled for 4-5 October 2007 and there is a significant risk that this could be delayed until the December 2007 meeting.

Purpose of this document

1.19 The purpose of this document is threefold.

• Firstly to set out revised technical conditions for two proposed SURs for the 1452-1479.5 MHz sub-band, one set of rights for a high power-low density network and another set of rights for a low power-high density network.
• Secondly to set out details of a combinatorial-clock auction design that allows bidders to guarantee, through the auction, that they have adequate frequency separation from other users with different SURs.
• Thirdly to discuss issues relating to possible inefficient hoarding of spectrum in this band.

1.20 This document does not seek to fully address all of the points made by respondents to the previous consultations or to revisit the other areas relevant to the award of the available spectrum which were addressed in the consultation document, e.g. options for packaging the available spectrum or the associated technical and regulatory conditions specific to the wireless telegraphy licences. As such this document should be read in conjunction with the previous consultation documents. Ofcom’s decision on all of these issues will be set out in its Statement on this award.

1.21 Stakeholders have repeatedly emphasised to us that it is important to award this spectrum as soon as possible. Therefore, as these issues have already been consulted on, this consultation will only last for 7 weeks. Following this Ofcom is planning to publish its statement, information memorandum and draft regulations after the October 2007 RSC meeting. Subject to the international constraints, this will allow Ofcom to aim for an award of the spectrum as soon as possible thereafter.

1.22 Ofcom would welcome comments or views on any aspect of this document by 12 September 2007. In particular:

Question 1: Do stakeholders agree with proposals that compliance with SUR aggregate PFD limits is determined by use of modelling? Do stakeholders agree with the proposal to use ITU Rec 1546 version 3 with clutter and terrain information at a 50m resolution? Do stakeholders have a view as to the terrain and clutter map database to be specified?

Question 2: Do stakeholders agree with the proposal for 95% of locations to be used for specifying aggregate PFD emission restrictions?

Question 3: Do stakeholders agree that the SUR PFD limits for channels LO and LP should be increased to be consistent with the SUR PFD limits for channels LA to LN? Do stakeholders agree that no further restrictions other than those detailed in the SURs need to be applied to LO and LP in order to protect the upper 12.5 MHz sub-band from ACI?

Question 4: Do stakeholders agree with the proposal for additional density limit restrictions for inclusion on the high power licence and is the proposed density limit appropriate?

Question 5: Do stakeholders agree with the proposal for additional EIRP limit restrictions for inclusion in the low power licence and is the EIRP value proposed appropriate?

Question 6: Do stakeholders agree that 3.4 MHz (2 lots) is a suitable separation between holders of the two types of licence?

Question 7: Do stakeholders agree that there should be no right to transmit in the guard bands? If stakeholders consider that there should be some transmission rights in the guard bands what would be an appropriate level?

Question 8: Do stakeholders agree that transmitter EIRP masks are not required in licences for this award?

Question 9: Do stakeholders agree with the proposal to develop two industry codes of practice on engineering co-ordination to control ACI?

Question 10: Do stakeholders agree that Ofcom should award the 1452-1492 MHz band using a combinatorial clock auction design that:

1. allows each bidder to express their preference for one of two usage rights;
2. allows usage rights to be varied across different packages (but not within a single package); and
3. guarantees that a guard band is maintained between the different usage rights?

Question 11: Do you agree with Ofcom’s assessment that it would be inappropriate to include a licence condition to address inefficient hoarding concerns in the 1452-1492 MHz spectrum award?

Structure of this document

1.23 Section 2 of this document summarises the proposed technical licence conditions. It presents the parameters of the two SURs, and describes additional technical conditions proposed for this award. Section 3 explains the key modifications of the combinatorial clock auction format and sets out how it may be expected to work in this award. Section 4 considers issues relating to an inefficient hoarding licence condition. Section 5 summarises the proposed timing and next steps.

1.24 Annex 1 sets out the process for responding to this document, with Annex 2 setting out Ofcom’s consultation principles. Annex 3 contains a consultation coversheet, with Annex 4 setting out the question to which Ofcom is seeking stakeholders’ responses. Annex 5 describes in detail the proposed SURs and the assumptions used to calculate them. Annex 6 describes the assumptions and inputs used in the SUR modelling tool. Annex 7 contains an impact assessment considering the inefficient hoarding of spectrum. Annex 8 describes the detailed auction rules and procedures proposed for the award of 1452-1492 MHz. Annex 9 contains example draft licences.

Footnotes:

1.- “Award of available spectrum: 1452-1492 MHz”, Ofcom, 31 March 2006, http://www.ofcom.org.uk/consult/condocs/1452-1492/

2.-http://www.ofcom.org.uk/consult/condocs/1452design/

3.-http://www.ofcom.org.uk/consult/condocs/1452tech/

The full document is available below