Assigning radio spectrum to mobile at expense of digital TV 'hard to justify', new report says

Out-Law News | 20 Jan 2014 | 3:59 pm | 1 min. read

Broadcasters should not lose their access to frequencies that currently support digital terrestrial television (DTT) to support the growing demand for mobile data services, according to a new report commissioned by broadcasters and a broadcast infrastructure company.

The report (78-page / 1.86MB PDF), commissioned by Digital UK, a group set up by the BBC, ITV, Channel 4 and Arqiva, said that allocating radio spectrum for the provision of DTT services offers greater economic value than allocating the spectrum for mobile data services.

"The marginal value of DTT spectrum is likely twice that of mobile data," the report estimated. "On this basis, it is hard to justify assigning additional spectrum to mobile at the expense of DTT."

Last November UK telecoms regulator Ofcom outlined plans to liberalise more radio spectrum for mobile data services and increase the existing capacity. Ofcom wants to expand the mobile network infrastructure so as to serve the growing use of mobile devices for accessing the internet and downloading data.

In its mobile data strategy the regulator said it was committed to ensuring that the public can continue to benefit from DTT services but admitted that in future some of the spectrum used for providing the services may be reallocated for mobile data services instead.

The Digital UK-commissioned report said that even if mobile data provided greater value for money from spectrum use than DTT, there would nevertheless be "substantial direct cash costs, and softer (but real) ‘signalling’ costs" in realigning existing DTT spectrum use to other frequency bands.

"We must ensure that decisions taken on future use of spectrum avoid a detrimental impact on consumer choice, platform competition, content investment and the wider creative industry and its ability to drive jobs and growth," it said.

The report said that although there is a "consensus" that mobile services taken as a whole "creates more value than DTT from its spectrum use", but it said that the debate over future spectrum allocation was about mobile data as opposed to mobile voice services. It said that mobile data services provided a lower value per MHz used than both mobile voice and DTT services.

The report also pointed to "social benefits" that the provision of DTT services offers and said that it is vital that terrestrial broadcasters have access to spectrum for providing such services so that they can maintain competitiveness in the TV market.

"By rapidly replicating the innovations of pay operators (such as PVRs (Personal Video Recorders) and HD channels), DTT requires those operators to constantly raise their game in order to justify their substantial price premium," the report said. "This encourages pay TV innovation and investment in both content and platforms. Thus DTT benefits not just its own customers, but those of all platforms. Against this background, securing sufficient spectrum to enable DTT to continue its role as a robust competitor is essential."