UK Mobile Radio Coverage – at a cross-roads!
The great digital dividend spectrum auction is fast approaching when the highly desirable spectrum at 800 MHz will be on offer to the mobile radio industry. It opens up a unique opportunity to improve rural coverage since 800 MHz is particularly well matched for this. But spectrum alone does not generate coverage and the other key ingredient is the number of new base station sites.
Full national coverage is what a country ideally needs from its mobile radio infrastructure but this aspect of what has otherwise been a success story has not been trending in the right direction. The past 10 years has seen little improvement in dealing with existing GSM coverage “not spots”. Anyone having a poor mobile signal 10 years ago is likely to still have a poor mobile signal today. When 3G came along investment priorities were switched to the new technology. But the roll out of 3G has been particularly disappointing. Japan achieved “national” 3G coverage in around 3 years whereas in the UK after 6 years we had not passed 80% of the population. Even today 3G coverage is patchy with gaps on our road and rail links. Part of the reason for this has been the historic trend of always having to look higher in the radio spectrum to find new bandwidth for the next generation of mobile technology. Coverage becomes more expensive at higher frequencies and a pure market driven industry will always tend to go for the easier demographics. This is generating an adverse trend that as the capacity of our mobile infrastructure is getting better so the national coverage is getting worse. In the future it is trend that is set to accelerate with rising mobile access speeds.
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It is always useful at a time of change to go back and ask the fundamental question – what do we want from our national mobile infrastructure? An appropriate aspiration would be an infrastructure supporting an affordable service that delivers any content to any location at the right data speed (without constraints) to small mobile portable devices. With that (or something like that) in place as a long term national goal it helps us to see more clearly the big coverage challenge of the coming decade.
Ofcom is currently consulting on whether to impose a coverage obligation on only one of the 800 MHz radio channels. The coverage obligation they have in mind is 95% of the population getting at least 2 MB/s down-link access speed (with an assumed probability of this being actually achieved). The question is whether Ofcom is rising to the big coverage challenge with the coverage figure it is consulting on. Sadly it is not!
To see why this figure lacks ambition we need to dig a little deeper. In fact a lot deeper. The particular definition of coverage Ofcom is proposing is incredibly complicated. In fact it is so complex that they have had to make a number of simplifying assumptions making the 2 MB/s questionable if for no other reason that it can never be directly verified and therefore enforced.
Fortunately, there is a simple test of how ambitious a mobile coverage obligation is. How many new base stations does it demand? It is clear from the consultation document that the particular value of 95% of the population has been arrived at to avoid the need for any new base stations. It follows from this that their proposal will not drive any significant new rural mobile coverage.
This brings me to my first recommendation. At the end of the day the decision on all coverage obligations is not based on science but the result of a negotiation…so the “Ask” is what matters. Since there can never be enough coverage the decision is always taken purely on the basis of cost – which broadly translates into the number of new base stations that it requires. Since this is what decides the outcome it would be far clearer for all parties if this is what we all debated.
What is a proportionate cost to impose on an 800 MHz licence? The figure is likely to be in the range 0 to 3500 new base stations which, at roughly £150,000 per new base station, puts an obligation on a scale of zero to £525m. Ofcom’s current proposal amounts to zero on this scale.
In the Ofcom consultation document they also give some figures of what an 800 MHz licence might raise at the auction based on the German and Swedish auctions. This suggests that 10+10 MHz of the 800 MHz spectrum would raise in the range £440 – £760m.
In normal time that might be the perfect outcome – plough the auction proceeds for this one 800 MHz licence back into improving the national mobile coverage. But these are not normal times and despite official protestations that the spectrum auction has nothing to do with raising money for the Treasury… the state of our national finances is the silent elephant in the room. That said the track record of our current Chancellor is extremely good in recognising the importance of improving and modernising infrastructure for the national economy. And certainly the rural economy has agriculture and tourism with the potential to grow or become more efficient with the right enabling digital communications infrastructure.
The brings me around to my second recommendation…1400 new base stations would be my stab at the right sort of coverage obligation. Coupling this number with the new 800 MHz spectrum and applying this to the last 5% of the population would make a big step forward and at a rough cost of £210m would still leave the Treasury with taking the lion’s share of the auction proceeds. The figure is also close to the figure Ofcom are proposing as the deposit for those wanting to bid for an 800 MHz licence at the auction.
The next point concerns the Ofcom proposal for the coverage “not spots”and the BDUK activity. The coverage “not spot” issue is being treated not only separately from the coverage obligation but by a separate mechanism. Ofcom deserve much credit for coming up with an imaginative solution for the coverage “not spots” but do not go into detail. Instead they promise a document for later this year. Now I can understand that coverage “not spots” are best addressed with today’s spectrum and technology but they will also need new base stations. The cost of up-grading those new base stations to 800MHz broadband in due time would only involve a relatively modest incremental cost…what a lost opportunity if this was not worked into the new mechanism Ofcom have in mind to explore.
Another mechanism for potentially improving rural mobile coverage is being pursued by BDUK where studies show that broadband mobile radio could be an appropriate solution for just under 1m homes. They find themselves in a situation where an 800 MHz coverage obligation could make a very serious contribution to their mission of the best super-fast broadband in Europe – providing that coverage obligation delivers new rural base stations – 1400 new base stations I am reliably told would be transformational.
So my last recommendation for Local Authorities and others wondering how best to respond to the Ofcom consultation document is to recognise that this is a unique opportunity to see significant improvements in their local mobile broadband infrastructures and if they are thinking of responding to the Ofcom consultation documents (which needs to be by the end of May 2011) to press Ofcom to focus on a coverage obligation that demands new base stations to be built and in the absence of any better figure…why not 1400 such new base stations.
The ideal way forward is for Ofcom to be encouraged not only to be more ambitious in what it asks from a coverage obligation and make a future broadband link with the coverage “not spot” solution but also harmonise with the mobile radio element of the BDUK initiative. In this way Ofcom can seize this timely opportunity to lay the foundation for a long term plan and necessary resources to turn-around the adverse coverage trend described above that would otherwise significantly diminish the effectiveness of our national mobile infrastructure.