EU move lends helping hand to UMTS900

The EU’s official ratification of the updated GSM Directive is good news for operators across the region. The move means that governments will now be obliged to allow them to use 2G spectrum to roll out 3G and other high-speed technologies in the 900MHz band.

Ultimately, the new rules will give operators a more efficient and cheaper way to expand their networks than higher frequencies would. These factors will increase in importance as operators move toward higher-speed technologies, such as LTE.

The decision to update the GSM Directive is not new in itself, because the European Parliament and European Council had already approved a Commission proposal to do so earlier in the year. And the lack of a revised directive has not actually stopped some member states, such as Finland, from starting to allow UMTS900.

However, others have awaited legislation, and the new directive should give them more clarity on how to proceed. Its publication as a law in the EU’s Official Journal also sets the directive in stone and has given the Commission the chance to reiterate its commitment to ensuring that UMTS900 becomes a reality.

Additionally, the move has set down an official timetable for 900MHz spectrum to be opened up to other technologies, which could help speed up deployments. Member states have six months to put the directive into practice, making 900MHz and 1800MHz frequencies available for other technologies.

And the move will put even more of an onus on national regulators to sort out any potential competition issues that could obstruct the opening up of the 900MHz band.

From the Commission’s point of view, it is important that the new measures come into practical use as quickly as possible, particularly after the significant delays that have been caused to its attempts to enable UMTS900 in the past.

Before these developments, the GSM Directive had reserved the 900MHz band for GSM. The Commission had originally tried to repeal the directive by end-2007 or early 2008, but the attempt was blocked by the European Parliament.

The Commission then changed tack and sought instead to amend the GSM Directive to open it up to other frequencies, a move that has ultimately resulted in the latest developments. The Commission also sought to adopt the same rules for 1800MHz frequencies as for the 900MHz band.

From an operator’s perspective, the potential savings from using the 900MHz band are certainly significant. Industry figures suggest that it costs a third as much to build a UMTS900 network as a UMTS2100 one. The reduction in capex and opex is also on the scale of 50-70%.

And the Commission estimates that spectrum refarming will save the region’s mobile industry up to €1.6 billion (US$2.39 billion).

The 900MHz band is also beneficial in terms of allowing much better signal propagation and indoor penetration than spectrum in the 2.1GHz band.

Challenges remain

However, enabling UMTS900 is not a straightforward process in many countries, largely because of debates between operators and regulators about how to reallocate 900MHz frequencies.

The main difficulties are in countries where later entrants have access to only 1800MHz or 2100MHz frequencies. These companies want 900MHz spectrum in order to compete on equal terms, but regulators must balance their requirements against incumbents’ reluctance to give up frequencies.

The situation in Sweden, where operators are looking to be among the world’s first to launch LTE, has also shown how there can be challenges even when operators can agree on dividing spectrum.

Swedish regulator PTS decided in March to redistribute 900MHz spectrum after the country’s operators had agreed between themselves on a method for doing so.

However, MVNO Ventelo filed a complaint with the European Commission because the spectrum was not opened up to other providers as well, and Sweden’s Competition Authority reportedly began investigating the allegations in September.

Such obstacles are not easy to resolve and could cause more delays to UMTS900 rollouts in some member states. And it would not be surprising if there were more challenges from European operators over any spectrum decisions.

Nonetheless, it would certainly be in operators’ interests for UMTS900 to be enabled as quickly as possible, so they can make the most of the mobile broadband opportunity.

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