Ministry reverses view on banning 2GHz spectrum-grabbing

The latest radio spectrum strategy from the Ministry of Commerce reverses an earlier position that big players should be prevented from acquiring too much radio spectrum in the 2GHz band, which is crucial for Personal Communications Services (PCS) applications. Clear was the only telco to favour the idea of a cap on acquisition of spectrum in forthcoming auctions, and then only in what officials describe as a 'highly muted' way.

The latest radio spectrum strategy from the Ministry of Commerce reverses an earlier position that big players should be prevented from acquiring too much radio spectrum in the 2GHz band, which is crucial for Personal Communications Services (PCS) applications.

The new view is outlined in a Ministry of Commerce draft management plan for the 2GHz Band (the spectrum between 1.7HGz and 2.3GHz) announced at TUANZ last week by Communications minister Maurice Williamson. Williamson suggested auctions for spectrum rights could be fixed before the end of the year.

Officials from the ministry's radio spectrum strategy unit had feared that if a firm "strategically" purchased spectrum, it could withold it from competitors for long enough to gain a competitive advantage, even if it was eventually forced to surrender it.

But the "risk of judicial review", difficulty of enforcement and a general lack of support from interested parties at the ministry's PCS Workshop have led to a reversal. In subsequent submissions from telcos, only Clear Communications expressed support for a cap on licenses, and then in what officials have described as a "highly muted" way.

Competition for 2GHz bandwidth is now growing, between existing microwave services used for monitoring and control of the National Grid, TV and general communications, including those associated with satellites. Subsequent to auctions, existing 2GHz Band users will be eligible to apply for an "incumbent" license.

What will be auctioned are spectrum management rights (MRs), which entitle owners to create licenses "either authorising persons to transmit radio waves, or ensuring that specified levels of interference are not exceeded."

Although MRs as proposed by the ministry do not specify the applications for which frequency won at auction must be used, the draft plan explicitly addresses the issues of PCS technology, High Tier or "public" PCS. Williamson describes the draft as "an important step forward in the ongoing development of radio spectrum management in New Zealand."

The Commerce plan proposes the creation of "management rights of various sizes" in the 2GHz Band, with "most of these to be sold as soon as possible by auction." To keep the auction and licensing processes simple, the ministry suggests keeping the number of MRs to a minimum, "consistent with giving prospective bidders some flexibility."

Not all of the band will be up for auction. The plan proposes that a general licence be created for the use of the 1880.00 to 1906.10 spectrum by cordless phones and wireless PBX devices, and the retention of spectrum currently designated to satellite services.

The minister's introduction to the paper closes with the expectation that future papers will cover more new uses of the spectrum which will "compete with the existing uses for access to what is becoming a scarce and valuable resource."

The Draft Management Plan, 2GHz Band is available in PDF format from the Ministry of Commerce Website at:

http://www.moc.govt.nz

Submissions on the plan close on Friday August 31.

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