ETE 521: TelecommunicationBusiness and ManagementModule 07: Spectrum Management
Introduction: From its humble beginnings as an abstractmathematical idea propounded by JeanBaptist Fourier (1768- 1830), radio spectrum(or spectrum for short) has now become anindispensable element in a diverse range ofapplications including broadcasting, mobileand satellite communications and radar. Vital services such as national defence, publicsafety, disaster warning, weather forecastsand air-traffic control all depend on access tospectrum.
Trends in spectrum demand: To a large extent, the recent trend ofliberalization, deregulation and privatizationin telecommunication services, particularlyin the mobile and ISP sectors, haveincreased competition, in turn causingmobile telephony prices to fall and demandto rise. Correspondingly, new technologies andservices, such as mobile data, have beendeveloped alongside to tap this increaseddemand for ubiquitous access tocommunication.
With its cost advantages and its ability forrapid deployment, wireless access fortelephony and data services has alsoconquered new markets. Wireless networks are fast becoming thepreferred infrastructure solution fordeveloping countries and rural areas wherefixed-line communications have been foundto be too costly to deploy.
Meanwhile, while the recent growth indemand for mobile telecommunicationservices has driven a large portion ofspectrum demand, the growing popularityof entirely new applications such as theGlobal Positioning System (GPS), whichwas originally developed for defensepurposes, as well as radio trackingapplications such as the use of RadioFrequency Identification (RFID) tags havealso placed a greater burden on spectrumresources.1
Implications for spectrummanagement: While governments have kept pace with spectrumdemand over the better part of the last century bygradually increasing spectrum supply, technologicaladvances and economic liberalization over the last fewyears have dramatically increased the pace of spectrumconsumption, causing demand to increasingly outstripsupply. This spectrum crunch has placed greater pressure onregulators to correctly ration and balance spectrumdemand between various competing uses. With this growing strain on regulatory resources, theshortcomings of the traditional, centralized approach tospectrum management have been made more apparent,causing governments to seek new approaches tospectrum management.
Regulatory frameworks forspectrum management: Because two or more radio signals occurringsimultaneously and over the same frequency caninterfere with each other and nullify their benefits,spectrum must be managed to prevent interference. When Guglielmo Marconi invented communicationover radio waves in the late nineteenth century, therewas no system of management of the electromagneticspectrum to ensure its orderly use. As a result, users of radio communication devicesthen simply transmitted over any spectrum band thatwas suitable for their purposes. However, as applications and services for radiocommunications grew, interference became anincreasing problem.
Faced with the growing problem of interference, it was soonrecognized that national and international regulation of thespectrum would be necessary for the effective use of radiocommunications, prompting governments to introduce aframework for radio licensing on a national level and aframework for spectrum coordination at an international level. In 1903, two years after the first successful transatlantictransmission and reception of radio signals, Germanysponsored a "preliminary conference concerning wirelesstelegraphy" which eventually led to the signing in 1906 of thefirst International Radio Convention that coordinated the use ofspectrum at an international level. Concurrently, nationalgovernments were also taking similar measures to managetheir spectrum. The New Zealand Government was reputedly the first in theworld to take control of spectrum management by way of theNew Zealand Wireless Telegraphy Act 1903.
The basic design of spectrum regulation andmanagement that emerged was rooted in theradio technology that Marconi developed,which required high signal to noise ratios. To avoid interference, a multi-layered systemof spectrum management was developed. This consisted essentially of two steps: theinternational allocation of spectrum bandsaccording to broadly defined services and thenational assignment of licences by nationalregulators to users who would be givenexclusive privileges to operate over certainfrequencies within these allocations.
International TelecommunicationUnion (ITU): Today, spectrum at the international levelis managed within the framework of theInternational Telecommunication Union(ITU). This specialized agency of the UnitedNations has among its major purposes theavoidance of radio interference and theequitable and efficient use of spectrum andorbital resources. This mission is conferred mainly to its Radiocommunication Sector (ITU-R)
ITU-R develops and adopts the Radio Regulations, a voluminous setof rules that serve as a binding international treaty. It essentially governs the use of spectrum by allocating spectrum tosome 40 different services around the world. ITU-R also acts as a central registrar of international frequency use,recording and maintaining the Master International FrequencyRegister which currently includes around 1 265 000 terrestrialfrequency assignments, 325 000 assignments servicing 1 400satellite networks, and another 4 265 assignments related tosatellite earth stations. With these resources, ITU-R coordinates efforts to eliminateharmful interference between radio stations of different countriesand promulgates recommendations on technical and operationmatters to improve the use of spectrum and of geo-stationaryorbits for radio communication services. The ITU-R also sponsors World Radio communication Conferences(WRC) once every three years, which update the Radio Regulationsin response to changes in the needs and demands for spectrum.
Regional organizations: The management of spectrum on an international level, however, is notrestricted to ITU. As a critical resource, regional organizations have alsobegun to play a greater role in spectrum management policies. As a notable example, member states of the European Union (EU) aresubject to mandatory EC legislation and to the optional regulation of theEuropean Conference of Post and Telecommunications Administrations(CEPT), which provides detailed guidance to National RegulatoryAuthorities (NRA) on frequency allocations, harmonization and technicalcriteria. It is interesting to note that in the case of the EU, the role of regionalinstitutions in determining spectrum use on a national level may beexpanding. Citing the need for greater certainty, the recently adopted “Decision on aRegulatory Framework for Radio Spectrum Policy in the EuropeanCommunity” proposes to make CEPT decisions mandatory among memberstates in cases where policy agreement is reached on harmonising the useof radio spectrum to implement EU policies.
National institutions: After a set of spectrum bands have been allocated fora service by ITU, each nation adopts some or all ofthose bands for the service within its jurisdiction. Based on these allocations, a national table offrequency allocations or “band plan” is developed by anational regulatory administration that has beentasked with the function of spectrum management. Accompanying rules are also sometimes developedalongside each band in order to define the particularband’s licensing, operating and technical rules. The national regulatory administration then assignslicences to users giving them the exclusive right tooperate on a specific frequency in a specific locationor geographic area and under specified technicalconditions (power, antenna height, etc).
Spectrum is usually assigned using to one of several approaches.Traditionally, where demand for spectrum within a particularband is considerably less than supply, most regulators haveadopted a “first-come, firstserved” approach. However, where spectrum demand exceeds supply, regulatorsare required to choose between competing applicants. Comparative hearings are occasionally used to allow regulatorsto make a licensing decision based on an established set ofcriteria, which may include the financial stability of the applicantand its technical competence – among other factors. In some cases, lotteries may be used to award licences throughrandom selection. Increasingly, however, regulators have turned towards spectrumauctions to awarded licences.
The role of spectrum management:Objectives In managing spectrum, regulators are concerned with twoforms of efficiency: technical and economic, which arepursued within the overall context of public policy. The objective of technical efficiency principally relates toachieving the most intensive use possible of availablespectrum within acceptable interference limits. It alsoseeks to promote the development and introduction ofspectrum-saving technologies. Economic efficiency, on the other hand, involves ensuringthat spectrum is allocated and assigned to uses thatderive the highest economic value from it. Overall, the regulatory process of ensuring both technicaland economic efficiency has to be sufficiently flexible andresponsive to adapt to changes in market valuations andtechnologies.
Public policy goals also play an overridingrole in determining spectrum managementpolicies. Efficiencies may have to be sacrificed inorder to safeguard the provision of certainpublic services such as defence, safety andpublic broadcasting services. In addition, the pursuit of technical andeconomic efficiencies are also constrainedby international obligations related tospectrum use.
Under static conditions, the administrativemanagement of spectrum can be expectedto yield technical and economic efficiencies. However, in the current environment of fastpaced technological and market change,centralized administrations have been seenas slow to react, inefficient and biasedtowards the status quo and incumbentinterests.Changing paradigms andconvergence
Further taxing this inherent rigidity of the regulatorysystem, the increasing “digitization” of information andcommunications and the resulting convergence oftechnology also have resulted in the “blurring” of theboundaries between traditional service definitions alongwhich regulators allocated spectrum. Where traditionally different radio communication serviceswere regarded as separate, involving different spectrumallocations, a single platform can now be used to deliver awide variety of services to customers.
For example, broadcasting, is moving towards moreinteractive applications with the introduction of IPdata casting, where digital content formats, softwareapplications, programming interfaces and multimediaservices are combined through Internet Protocol (IP)with digital broadcasting. Similarly, mobile systems are now capable ofdelivering access to live broadcasting content. In addition, third-generation (3G) mobile networksare potentially capable of transmitting data rates ofup to 2Mbit/s, overlapping with the presentperformance of broadband fixed wireless access.
Beyond the inherent weaknesses of a centralized spectrummanagement approach, it is also increasingly acknowledgedthat market players such as operators and equipmentmanufacturers posses more knowledge about the spectrumthey require as well as more information regarding theappropriate technologies to deploy and consumer preferences,than an administrative body would. As such, there exists considerable merit in allowing morespectrum management decisions to be made by those whowould eventually use the spectrum. Faced with increasing pressures from an unpredictable marketsand rapid technological change, a growing number of countrieshave started de-regulating, or are considering deregulating,portions of their spectrum management regimes; replacing thetraditional centralized command and control regulatoryapproach with more market-based approaches.
New approaches to spectrummanagement: There is a growing trend towards deregulation and agreater reliance on market forces in spectrummanagement. Many countries have now started to introduce some formof market-based mechanism in managing spectrum. At one end of the scale, many countries have retainedcentralized control over functions such as spectrumallocation while introducing market-based mechanisms,such as auctions, to assign spectrum. At the other end of the scale, a few countries, likeAustralia, Guatemala and New Zealand, have gonefurther in deregulating spectrum management byallowing the market-based allocation of spectrum use.
While these market-based measures have beenintroduced within a system of exclusive rights, wherespectrum frequencies are assigned for the exclusive useof a licensee, many countries have also allocatedspectrum bands for licence-exempt use, effectivelyallowing more freedom for market players to managespectrum among themselves. This section will describe two significant approaches tospectrum management that are being widely consideredfor implementation or expansion: spectrum trading andlicense-exempt spectrum.
Spectrum trading: Moving beyond the initial phase ofspectrum rights assignment, there exists amuch wider scale of policy options thatallow for the market-based determinationof spectrum allocation and assignment. At this secondary phase of spectrummanagement, market players can beentrusted with a wide variety of rights thatcan be exercised through trading, theserange from spectrum leasing to changingspectrum use.
In their consultation document on the implementation of spectrumtrading, the former Radio communications Agency (RA) in the United Kingdom identified four major modes ofspectrum trading, reflecting a wide range of ownership rights available: • mode 1: change of ownership; • mode 2: change of ownership and reconfiguration (which coverspartition and aggregation); • mode 3: change of ownership, reconfiguration and change of use,and • mode 4 : change of ownership and change of use. Spectrum trading variants also include spectrum leasing and spectrumsharing arrangements. Different modes and trading variants have been applied among thedifferent countries that have allowed secondary trading.
Modes of spectrum trading:Spectrum leasing and spectrum sharing Spectrum leasing or sharing typically involves a partialtransfer of a licensee’s rights to spectrum either for a limitedperiod of time and/or for a portion of the spectrumencompassed in the licence. This includes, for example, thetransfer of the right to transmit from one site under a multi-site licence for a temporary period. The flexibility afforded by such an arrangement isparticularly ideal for situations where a lessee’s requirementsare minor or temporary. It also allows licensees to benefit byallowing them to receive returns on portions of theirassignment for which they have no present need. This allows unused spectrum to be released into the marketand creates a financial incentive for licensees to adopt moreefficient ways of utilizing their existing spectrum.
Modes of spectrum trading:Changes in ownership Changes in spectrum ownership or licensee throughsecondary trading have been permitted in some bands byAustralia, Canada, Guatemala, New Zealand and the UnitedStates. The FCC in the United States has allowed trading inlicences in secondary markets. Prior approval from the FCC is necessary, however, before atrade can take place and as a result trading has been limitedbecause of the added risks involved. Nevertheless, the FCC is currently reviewing its rules andprocedures to lower barriers in the secondary market and topromote more flexibility.
Modes of spectrum trading:Spectrum reconfiguration The ability to partition and aggregate spectrum to a user’sneeds has been identified as an important element inachieving greater flexibility and efficiency in spectrumuse. Users would have the incentive to only purchase or retainwhat they require while also allowing them to respond tochanging spectrum needs over time. Allowing spectrum partitioning would also provideincentives for licensee’s to use spectrum more efficientlyas they could partition and sell off unused spectrum whileallowing spectrum aggregation could facilitate theintroduction of wider networks that may be of greatervalue than independent and isolated systems.
Modes of spectrum trading:Changes in use The permitted extent of change of use can also vary widely,depending on the particular concerns of the regulator. For example, it could be very limited, allowing a private mobileradio license originally issued for taxi use to be used by taxi orcourier services, or it could be very flexible, allowing mobilespectrum to be used for broadcasting. Depending on the geographic isolation of the country, changes inspectrum use can be constrained by international obligations, suchas the ITU Radio Regulations, spectrum harmonizationrequirements and bilateral agreements. Governments may also seek to restrict changes in use in order tomaintain diversity in the provision of radio services. For example, mobile communication services could be offeredthrough a range of alternatives from self-provided trunked mobilesystems to cellular telephony. Some of these obstacles to changesin spectrum use are discussed later in this paper.
License-exempt spectrum In contrast with spectrum managementregimes based on exclusive rights, alicence-exempt model does not assignusers exclusive use privileges overspectrum. Instead, access to spectrum is either opento all users open access spectrum) or to agroup of users who hold the rights to thatspectrum in common (spectrum commons). In this way, multiple users are encouragedto reuse the same spectrum space.
Licence-exempt spectrum use is usually permitted in two forms.The first involves low power transmissions, where interference islimited by strict power limits and regulatory equipment approval. This allows lowpower users to co-exist in bands simultaneouslyused for higher power emissions. The second involves spectrumuse in bands allocated for licence-exempt use. Bands like the 2.4GHz “industrial, scientific and medical” (ISM) band, where802.11b standard operates, as well as the 5 GHz band, wherethe 802.11a standard and the emerging 802.16 standardoperate, have generated considerable attention in recent times. Most regulators require users of these bands to be subject tocertain restrictions, such as output power limits orcommunication protocols, and other “etiquette rules” aimed atminimizing interference.
Cross-cutting issues:Interference In the absence of exhaustive and precise technical detailsof all services and systems over different topographicaland meteorological conditions, a spectrum managementapproach that allocates spectrum along the lines ofservices or systems with homogeneous characteristics (interms of compatible RF power level, similar bandwidths,similar protection environments, similar potential forinterference and similar performance requirements)reflects the most practical way of attaining spectrumefficiency. Within this service-based allocation framework, regulatoryadministrations then co-ordinate the co-existence ofdifferent systems within the same frequency band as wellas between systems in adjacent frequency bands throughlicense assignments.
While this approach to interference managementbrings about a certain measure of technical efficiencyby removing some usage variables, it suffers from acertain amount of inflexibility and unresponsiveness. With the introduction of more market-basedapproaches to spectrum management, a more flexibleand transparent framework would be required. Although changes in the way spectrum assignmentsare managed may not require significant changes inthe current regime, changes in spectrum allocationpractices that allow for changes in spectrum use willimpact the interference environment considerably.
Interference management techniques, however, willeventually have to evolve to accommodate and exploitemerging technologies that have the potential to reducethe impact of the interference environment. To some extent, these technologies have been deployed infrequency sharing arrangements that allow newallocations in frequency bands have already been occupiedby other services. While low-density power technologies like spreadspectrum and ultra wide band systems hold great promisein allowing spectrum underlay to be exploited, frequencyagility technologies and smart antenna technology offergreat potential in mitigating interference concerns
Future trends: The introduction of spectrum trading or other deregulatoryapproaches is unlikely to act as a further stimulus tospectrum demand in the current market climate ofincreasing consolidation. Unlike the wave of telecommunications liberalizations in the1990s, the communications industry, manufacturers andoperators alike, appear to have entered a period ofmaintenance where they are looking towards minimizinginvestments and maximize returns. Nevertheless, the introduction of new technology that canincrease network flexibility and communications capacity islikely to attract industry attention as they will eventuallyallow operators to maximize the use of their existingspectrum. Spectrum management approaches that facilitatethis process could eventually reap the most gains
The spectrum management process is a mammothtask that governments are beginning to acknowledgethey cannot tackle alone. Technological progress and marketplace change haveplaced an increasing strain on the traditional spectrummanagement approaches that governments haveresorted to for almost 100 years. In the same way as the wave of liberalization,deregulation and privatization has swept over thetelecommunications sector as a whole, the regulatoryapproach to spectrum management is poised tofollow.
While the need for regime change is clear,there nevertheless does not appear to beone single spectrum management regimethat would bring about complete technicaland economic spectrum efficiency. Constant changes to the paradigm as wellas inherent differences in each regime willmean that spectrum management reformmay have to be pursued in a continuouslyprogressive fashion, by adopting differentapproaches in different spectrum bandsover different periods of time.