Electronic Communications Act, 2005 (Act No. 36 of 2005) ICASA Radiocommunication Frequency Migration Plan 2019 Appendices Appendix H : Articles 31 and 52 of the ITU Radio Regulations and Rec. ITU-R SM.1603 Annex 1 : Redeployment issues

 

 

The radio spectrum is a finite, but reusable resource that can benefit each administration by providing a medium to assist communications and economic development. In order to maximize the benefits to an administration the radio spectrum needs to be efficiently and effectively managed. Part of efficient and effective spectrum management is planning the development of radio services in advance of their requirement; this may include extending the coverage of existing services, enhancing the performance of existing services and introducing new services. This type of spectrum planning is considered to be associated with the development of a national spectrum strategy and the strategy is normally expected to cover a period of 5 to 10 years. Report ITU-R SM.2015 – Methods for determining national long-term strategies for spectrum utilization provides details on the planning process, evaluation of scenarios and appropriate procedures for transition from present spectrum utilization to long-term objectives.

 

To improve existing services or introduce new services, it may be necessary to move existing users of the radio spectrum to more modern technologies or new frequency bands. This movement of existing spectrum users, or as it is otherwise known, spectrum redeployment, needs to be planned. Spectrum redeployment should be included in the administration’s national spectrum strategy together with the mechanism identified to assist implementation of redeployment. It should be considered equally with all other options, i.e. sharing, removing restrictions, and not as a last resort.

 

Spectrum redeployment is not necessarily a simple task and an administration may face a number of difficulties that can complicate, delay and even disrupt the process. The administration is encouraged to use spectrum monitoring data to supplement other data when considering redeployment. The level of difficulty experienced and options of implementations available may subsequently influence an administration’s approach to spectrum redeployment. The following text examines the process of spectrum redeployment and the various factors that are associated with its use.

 

 

All administrations are compelled to introduce new radio services and for some this may include the need to move existing users of the radio spectrum to new technologies or new frequency bands. This prerequisite to move existing users of spectrum can arise for a number of reasons, for example:

 

If, as in the case of b) above, the spectrum allocation is not being used efficiently, there may be a requirement to re-engineer the band to improve spectral efficiency and this can include the following options:

 

Any of the above options may initiate a spectrum redeployment process in order to change existing users’ current equipment and/or their frequency assignment, even though any change in frequency may be limited to the same frequency band. In some cases, while the spectrum sharing criteria between services on a co-primary basis is already detailed the national requirements may compel the assignment of such frequencies to one of the new radio services and may require the redeployment of other radio services from the same band.

 

Where an administration is able to move existing users to unused spectrum, the spectrum redeployment process may be simple. However, resistance to change amongst radio users regarding the type or technology of equipment used, or to changes in frequency allocation, limits an administration’s flexibility to make spectrum available for new users and services. In addition, delays in the introduction of new services are undesirable as it can render a proposed solution obsolete before it is even implemented. Where a proposed change effects one or more frequency bands, a delay with a single service1 may impact on several other bands and services.

 

These delays, as studies have shown, are capable of causing significant financial losses to a country’s economy. If a solution is not achieved, this may lead in the long term to impairment in spectrum use and a reduction in radiocommunication development. Hence, it is important to avoid any unnecessary delays in the process once an administration has decided on spectrum redeployment.

 

Countries will continue to implement the transition from analogue to digital broadcasting with different time-scales according to their national priorities as well as, where applicable, the deadlines set by the ITU Regional Radiocommunication Conference (RRC-06) and its associated plan and agreement. During the period of this strategic plan, there will be a continuing need, as a high priority, to assist administrators, regulators, broadcasters and other stakeholders in developing countries in researching and supporting the introduction of digital broadcasting.

 

The extent of spectrum redeployment will depend on the demand for spectrum and the level of spectrum congestion within the administration. For those administrations with limited available spectrum where the level of demand for spectrum causes spectrum congestion, the need for an effective spectrum redeployment policy is self-evident. However, there are benefits in identifying a suitable spectrum redeployment mechanism for the longer term. Benefits can apply even to countries where spectrum congestion is not a problem, as the necessity to make spectrum available to take advantage of new services is an issue that faces all administrations, e.g. providing spectrum to take advantage of the global growth in mobile services.

 

 

Spectrum redeployment is a national spectrum management tool and therefore, in theory, any frequency band and any system could be subjected to some form of spectrum redeployment. In practice, spectrum redeployment might be limited by practical consideration such as international agreements and sharing criteria. Such criteria should be well work shopped and concisely agreed on

 

If properly implemented the administration should derive a range of technical, economic and social benefits aspects from the redeployment of spectrum.

 

A clear example of the benefit of more efficient spectrum use is the possibility to provide a wider range of modern telecommunication services directly impacting the quality of life of citizens and generating new business opportunities thus promoting employment.

 

It is important to note that the issues associated with applying spectrum redeployment in bands where use is exempt from licences are more complex than for licensed use, as there is no record of users of the service. The ramifications of these issues are described in § 3.2.2.

 

 

The approach an administration takes on spectrum redeployment depends on the time-scale in which the spectrum needs to be made available. For some services a change in spectrum use may be associated with a new international allocation. In such a case, the period for planning the introduction for the particular service may take place over a 10 to 20-year period and be subject to a long-term plan with detailed market predictions of the possible technology developments to justify the allocation process.

 

For services where the change in spectrum use is based on a change in the end user service, for example mobile data, the demand for spectrum access can arise in a short time span due to the rapid change of market requirements and the availability of the end user technology. These services may require a more flexible system for the national designation of spectrum for a particular service and typically would be characterized by a shorter planning cycle (i.e. less than five years) where spectrum needs to be made available over a much shorter time period.

 

Reasonable advance notice of proposed spectral changes should be provided to existing or new users to allow them a fair planning and implementation period. The spectrum manager should factor lead times and notice periods into its implementation schedule. In all cases, redeployment decisions should be taken at an early stage to allow the maximum time for the migration of existing services and systems. An early decision on spectrum redeployment is desirable, although not always possible, as it provides a clear basis on which existing and new users can develop their implementation plans and for larger systems may include establishing the necessary financial backing. To avoid leaving spectrum unused for any lengthy period, it is also desirable to have a flexible transition period with optimized transition dates for existing and new incumbants. However, this approach may require a compromise on technical decisions on the structure of the assignments in the frequency band and may not produce the most efficient use of the spectrum.

 

 

Spectrum redeployment may be used in a number of different ways but there are only two basic types: voluntary spectrum redeployment and spectrum redeployment by regulation.

 

 

This method of spectrum redeployment represents the case when an administration decides to implement spectrum redeployment and to use methods to encourage an existing spectrum user to voluntarily return the frequencies in use to the spectrum manager for reassignment.

 

This process tends to occur when an existing user recognizes that the benefits/costs to be derived from the transition is more compelling than the continued use of it.

 

The decision of existing incumbents to follow this route will almost always be based on its business case projections.

 

Factors such as technology progression, licence fees, maintenance costs, customer takeup, strategic reasons and ultimately regulatory direction will determine the operators eagerness to voluntary migrate This process is normally slow but can never be excluded as a component of the migration process.

 

When this spectrum redeployment method is to be used as part of an identified administrative policy then it may need to be linked to a charging mechanism, e.g. licence fees. To provide the greatest flexibility the charging mechanism also needs to be flexible. Hence this spectrum redeployment method may be suitable for charging mechanisms like spectrum pricing, where the cost of the licence can be linked to a wide variety of factors, e.g. coverage area, extent of sharing, bandwidth, hours of operation.

 

 

Regulatory spectrum redeployment is the approach associated with an administrative policy to redeploy spectrum. This method basically consists of the administration either terminating the licence or refusing to renew the licence. Early notification/publicity of the administration’s plans for the frequency band is essential to ensure that those affected will have the optimum time to plan alternative arrangements.

 

 

This approach currently appears to be the most common way of achieving spectrum redeployment. The difficulty faced by the administration in applying the policy will depend on the length of the licence term and the speed with which the administration wishes to recover the frequency band. If the period of the licence is short (e.g. one or two years) or the administration knows sufficiently far in advance that it requires this spectrum, then recovering the spectrum may not be a problem. However, if the administration wants to recover the spectrum quickly, it may face claims for compensation depending on the terms and conditions of the licence, if:

 

 

This approach requires that the administration announce its intentions to redeploy the spectrum sufficiently far in advance of the date on which they propose to reclaim the frequency band. To minimize difficulties, the administration could wait until the end of the equipment’s lifetime. However, the lifetime of equipment differs from service to service and for some systems, such as military equipment, updating technologies are used which further prolong the lifetime of equipment. For cases where the operational lifetime of the equipment is unacceptable, compared to the period the administration has set to recover the spectrum, it may be necessary for the administration to agree with the users a fixed lifetime for the equipment or impose a cut-off date; potentially giving rise to claims for compensation.

 

 

By definition there are no records of users and their application of services used in license exempt bands. It would be impossible to contact all users to notify them of redeployment bands, and this prevents the band from being emptied of incumbent users.

 

Considerations for new assignments or allocations of licence-exempt bands should take account of the legacy from assigning license-exempt services if the bands are later to be the subject of redeployment plans.

 

Most users of licence-exempt devices for short-range radiocommunication devices (SRD) (refer to Report ITU-R SM.2153) are reluctant to pay any costs caused by spectrum policy change. However, it is difficult to establish the spectrum policy plan in the licence-exempt bands because of life time of the products, which is between 3 and 10 years on the average depending on the product type.

 

In the case of redeployment of licence-exempt bands, the administrations may review the potential infringement of people’s property rights because most licence-exempt users are unspecified. In order to judge the property infringement for existing users, it needs to consider the relationship between the government authority and the property loss.

 

 

For the protection of unspecified users’ property rights in the licence-exempt bands, the items to be considered for spectrum redeployment policy are as follows:

 

 

Redeployment can impact on the budgets of administrations and existing users of the spectrum. The administration can lose revenue from licence fees if the period allowed to move existing users out of a particular frequency band is too long. It is the existing users who initially incur the cost of implementing spectrum redeployment, as they will need to purchase new equipment in addition to the new licence fee. The level of costs incurred by users will depend on the amount of equipment used, how much time they have had to amortize its costs and how much of their existing equipment they can reuse. Taking three typical examples can provide an indication of the range of costs, and while the costs may be associated with regulatory redeployment they could equally apply to voluntary redeployment:

 

 

This option assumes that all the equipment associated with spectrum redeployment process can be re-tuned. In this case, the costs may be limited to those associated with the re-tuning and testing of the equipment. If the costs of operating in the new frequency band were lower (e.g. a lower licence fee), the cost of re-tuning would be offset by the reduced operating costs. This approach is reasonably simple and therefore suitable for short-term implementation.

 

 

This option is potentially more technically and economically difficult to implement. For some services it may be impossible to move to other bands, e.g. science services using physically specific frequencies. For other services it may require a general change of the radio infrastructure, which could be costly. However, it should not be assumed that the costs are always high. If redeployment is part of a move to a new technology that is already available (e.g. a taxi company moving from two-way radio to a cellular phone) the cost to the end user may be low, providing they have had time to amortize the cost of their original equipment. In addition, the increased flexibility and performance could over a short period of time outweigh the costs. Depending on the extent of the operator’s infrastructure, migration to a higher frequency band may require a long transition period, due to the consequences of shorter propagation paths, e.g. re-designed infrastructure, acquisition of new transmission sites and equipment; this does not necessarily fit with the general desire for rapid changes in the telecommunication environment.

 

It should be noted that the consequences of migration to a lower frequency band can also lead to a longer transition period, because a greater propagation range may require international coordination.

 

 

This option would almost certainly require the purchase of some new equipment (e.g. a move from equipment with a 12.5 kHz bandwidth to a 6.25 kHz bandwidth). However, it is unlikely that this option would require any change in the transmission/reception infrastructure (i.e. antennas and masts) and so again the costs would be limited. If the costs of operating in the new frequency band are lower (e.g. a lower licence fee), then the costs of new equipment would be offset by the reduced operating costs.

 

Administrations may consider the existing market situation in terms of number of users and number of equipment using a particular equipment specification set, availability of the new equipment from different manufacturers and then decide on the realistic time-scales with costs impact while mandating the reduction in channel bandwidth. In digital radios, enhanced data rate support requires higher channel bandwidths and even channel aggregation as compared to the legacy analogue 12.5 kHz channels. These digital radios offer higher spectral efficiency per communication path even though using higher bandwidth. The digital radios offer many more data and multimedia services than the voice only service offered by the analogue radios.

 

 

Redeployment in certain frequency bands may require regional coordination. The implementation of GE06 Agreement involved digital switch over from analogue terrestrial broadcasting. To use the digital dividend for the mobile service, the analogue switch-off needed regional coordination because of the higher transmission powers of analogue terrestrial broadcasting.

 

 

Redeployment in certain frequency bands may require regional harmonization to achieve economies of scale. This has been experienced by recent examples of redeployments undertaken for IMT in different bands. Significant costs are involved in deploying IMT networks. Availability of equipment, propagation, bandwidth and harmonization across major markets are the key factors considered by service providers and therefore must be considered for spectrum redeployment.

 

 

From the above text, it can be seen that the effects of redeployment on existing spectrum users may vary from minimal, e.g. slight frequency adjustment in same band, to major, e.g. new transmission infrastructure in different bands. Incumbents that are subjected to major system changes may, in some cases, seek some form of compensation, based on administrative policies. Hence it is useful for the administration to have a range of spectrum management tools or mechanisms to encourage existing users to change frequency bands, particularly if the administration requires spectrum redeployment to be implemented speedely. Two mechanisms for encouraging spectrum users to vacate a frequency band are spectrum pricing on the one hand and some form of compensation for vacating on the other.

 

 

As previously noted, spectrum pricing can be used to encourage spectrum users to voluntarily vacate a frequency band. The use of spectrum pricing to promote rapid migration in cases of spectrum redeployment, can take three to five years to be materialise, and in in certain instances such a time-frame could be acceptable for the administration. Spectrum pricing has the benefit that it is fully flexible and can be applied to a variety of situations, as it enables a pricing structure to be created that provides spectrum users with the financial incentives to change equipment or frequency bands. In addition, spectrum pricing can also be applied progressively to promote spectrum redeployment on an area-by-area basis. This aspect of spectrum pricing is particularly helpful for addressing localised spectrum congestion or cases where a new service or new operating condition (e.g. reduced bandwidth, reduced power) would be introduced.

 

However, spectrum pricing may have the undesirable consequence of increasing illegal spectrum use, i.e. users that are not prepared to pay for a licence and require that more resources have to be provided on spectrum monitoring and spectrum enforcement activities.

 

 

The radio spectrum is an asset that belongs to the country and not to individual spectrum users. Payment of compensation should not be de facto policy, but if it is to be considered administrations should provide the appropriate policies for compensation and competition restrictions that comply with national legislation and international bodies such as the World Trade Organization (WTO).

 

In determining whether compensation is justified, deciding on the compensation and how it should be provided shall consider:

It should be noted that compensation does not only have to be given in the form of a direct financial payment; for example, it could take the form of licensing assistance (trial licences) or equipment subsidies.

 

The following subsections consider the potential sources of any compensation (see Report ITU-R SM.2012 for discussions on the issue of spectrum rights).

 

 

This approach has been used in some countries, e.g. Bulgaria, Finland, France, Israel, Italy, Jordan, the United Kingdom and the United States of America, where it was considered necessary to speed up the process of spectrum redeployment. Basically, it consists of the new entrant(s) compensating the existing spectrum users for early vacation of the frequency band.

 

The advantages of this approach are that the administration does not have to fund any compensation and, if properly managed, it can speed up the release of spectrum only when the new entrant requires it. However, there are several potential disadvantages; the new entrants may have to pay less or more than the market value for the spectrum or equipment/infrastructure unless a fund has been established through an auction mechanism or there is some form of spectrum trading, i.e. the user of the spectrum sells on the rights to use the spectrum. Furthermore, without a clear mechanism for trading or handling payments the process could raise issues of transparency. To avoid these concerns an administration may have to maintain strict oversight of the process, which may require considerable effort.

 

There are different ways this approach can be implemented:

 

An administration may provide legislation that allows payment of the expenses of relocating the incumbents’ operations from one or more frequencies to another frequency or frequencies, including the costs of any modification, replacement, or re-issuance of equipment, facilities, operating manuals, or national regulations incurred, e.g. pre-auction notices.

 

Where spectrum is to be auctioned the administration should make known, before the auction, the marginal costs anticipated to be associated with such relocation or with modifications necessary to accommodate prospective licensees. The administration’s procedures may include a process for resolving any differences that arise between the incumbent and new licensees regarding estimates of relocation or modification costs.

 

 

Some countries have introduced the concept of a redeployment fund to compensate spectrum users for having to hand back spectrum. This approach provides a number of possibilities for implementing redeployment in a shorter time-scale than waiting for the expiry of a licence. Redeployment funds raise a number of issues that need careful consideration, not least the concern that the very existence of such a fund raises the idea that any user of the radio spectrum should receive compensation if required to change some aspect of their operation. Hence it is necessary to clearly identify the conditions under which any compensation may be paid and to establish a transparent mechanism that can be used to determine the level of compensation.

 

A redeployment fund can be funded from a number of different sources, for example:

 

While a redeployment fund can provide a convenient means to speed up the spectrum redeployment process, it is not a universal panacea. Redeployment funds may not be sufficiently strong to pay for redeployment in other than limited cases. The fund will need to be managed and there may be concerns over transparency, which is likely to increase the effort and costs. In addition, the existence of the fund, its size, the frequency with which compensation is paid and the levels of any payments, could lead to an assumption by spectrum users that payment of compensation is guaranteed, distorting the market value of the spectrum and generating the type of negotiations that actually prolong the redeployment process rather than shorten it. In addition, in some countries, the concept that individuals or companies that do not use the radio spectrum, or the frequency band concerned, should compensate others may raise political or judicial issues.

 

 

Since the frequency redeployed in the licence-exempt band is changing from dedicated form to sharing one to increase spectrum efficiency, government support by frequency redeployment needs to be considered.

 

Object of the compensation is applied to radio station with licence of government such as permission, report, approval of use.

 

It is difficult to confer property right to licence-exempt devices because they are legally used without licence and any right acquisition activities from the administration. Even though property right of the licence-exempt devices is recognized, it is difficult to compensate its loss, because it is not regarded as invasion of property right under the law.

 

It is necessary to protect user by, for example, through a government service centre for replacement of an existing device, remodelling, money support, etc.

 

 

Spectrum redeployment is a spectrum management tool, which can be used to satisfy new market demands, increase spectrum efficiency or to respond to changes in international frequency allocations. In many cases, spectrum redeployment is a natural process as existing users change their radio operations based on new technologies and changing operational requirements. The main problems relating to spectrum redeployment occur when insufficient time is available for introducing a change in spectrum use, and it is necessary to use a supporting mechanism to speed up the redeployment process. However, the use of such supporting mechanisms can lead to objections from new or existing users about the consequent expenditure and inconvenience; it may require as much, if not more, management effort than the redeployment process.

 

While spectrum planning and the monitoring of spectrum requirements will not solve all redeployment problems, building these processes into the development of a national spectrum strategy may be a simpler way to limit problems associated with implementing spectrum redeployment.

 

Technical issues such as frequency usage plans and equipment characteristics are important considerations for administrations and users that need to be available for efficient and successful spectrum redeployment within the appropriate time-frames.

 

Reference the reports by the Electronic Communications Committee (ECC) within the European Conference of Postal and Telecommunications Administrations (CEPT) and the Permanent Consultative Committee III (PCC III): Radiocommunications of the Inter-American Telecommunication Commission (CITEL) could provide further information on the issues from a regional perspective and also include lessons from the experiences of other countries.

 

Attachments 1 to 6 provide examples of administrations’ experiences.

 

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