Spectrum policy can be a passionate subject, as could be witnessed at EIF dinner debate on 15 March. Representatives from the broadcasting, telecom and consulting industry reflected on the European Commission's recent package of broadband measures, including a five year policy programme for planning and harmonising the use of the EU's radio spectrum. What are the lessons learned to date in the broadband discussion?
From the broadcasting point of view the future of TV is hybrid, and will be partially carried via digital terrestrial networks in a mix with TV services delivered via broadband networks. Contrary to what one may think, the consumption of TV over broadband today is a meagre 5% whereas the other 95% is delivered in the 'traditional' way. If today all TV would be delivered via broadband it would be safe to say all broadband networks would collapse. Broadband, in the eyes of the broadcasters, can never be the only solution. In the short term there will be a need to combine both terrestrial and broadband networks. Digital Terrestrial will still be the main pillar of television in the decade to come. However, terrestrial tv will also remain important to guarantee universal service, safeguarding access for all.
The telecom debate is another story. Europe is playing a relatively small role in spectrum allocation policy. In the end it is the Member States who define their own policy with significant freedoms. The interests of the Member States are not always corresponding with the European interest. Member States are looking to balance their (own) state budget, promote coverage and innovation and create the highest possible added-value because spectrum is scarce. There is a strong field of tension between these policies because the focus is on state revenues. This means the largest operators in the market are pushed to pay the price their business case can carry. This price is too high for small carriers and new entrants because the large operators are always prepared to pay a premium. Smaller operators will be outbid which would be a disaster for competition, unless one wants to aim for consolidation. However, consolidation does not bring a single market for European mobile telecoms. It will in fact create, or maintain, 27 national markets with less competition. The risk is that there will not be even a mere beginning of a single market with such an approach.
If we want to make the best use of the new technologies it is important not to fragment the spectrum too much. This could be achieved by stimulating competition via virtual networks, or by sharing spectrum and infrastructure, especially if we take into consideration a desire for high quality rural coverage. The spectrum that is available right now will not be sufficient for the growing demand. Initiatives are needed from both the regulators and the operators. Since all operators need a good frequency mix, one solution could be to make frequency bands technology neutral. In this respect, Europe should perhaps pay more attention to how Member States work out their allocation policies.