Ofcom Outlines Mobile Spectrum Trading Plans

Ofcom has today published its proposals to give mobile phone operators the ability to trade valuable spectrum in an effort to increase network capacity and deliver faster mobile broadband.

The proposals will allow mobile phone operators for the first time to trade the radio spectrum that mobile phones use to communicate with mobile masts.

Ofcom states that there are currently 80 million mobiles in the UK, and more than 12.8 million of these are smartphones. Smartphones are being blamed for the increasing “data strain” being felt by mobile networks.

Spectrum Flexibility

Under Ofcom’s proposals, which covers spectrum at 900MHz, 1800MHz and 2100MHz, operators with a greater need for spectrum will be able to make offers for spectrum from those who need it less.

It hopes this added flexibility will help these operators to respond more quickly to demand.

“Currently it is not possible for owners of mobile spectrum to trade with competitors, or new entrants,” explained an Ofcom spokesman, speaking to eWEEK Europe UK. “Our proposals are designed to allow for trading, either a straight trade, a swap, or leasing spectrum on temporary basis.”

“We are also proposing that this spectrum trading can be done via geographic location as well,” said the spokesman. “Say for instance if an operator had capacity issues in one part of their network, they can trade spectrum with others in order to get more capacity. But this spectrum trading will more likely be used to improve efficiency.”

Bigger Blocks

“Mobile spectrum works better when used as a continuous large chunk of spectrum,” said the Ofcom spokesman. “This allows for a more efficient network and faster mobile broadband speeds for consumers.”

“Say for example an operator had spectrum in the 900MHz range, but in both the top and bottom part of that spectrum. They could trade the top bit of their holding for more at the bottom, to make their spectrum utilisation more efficient,” said the Ofcom spokesman. “After the forthcoming spectrum auctions we might see operators trading spectrum in order to consolidate their holdings.”

But some people, such as Stephen Rayment, CTO at networking specialist BelAir Networks, feel that while this spectrum trading may be a good thing for mobile operators, it will not alone be able to address the issues of data traffic brought about by smartphones and tablets.

Capacity Crunch

“Ofcom’s announcement around using radio spectrum to meet demands for mobile services confirms how data capacity remains a massive issue,” said Rayment. “However, it’s critical that we understand that more spectrum, as a finite resource, will not alone be able to address the exponential increase in data traffic driven by iPhones, tablets and Android-based devices.”

“Mobile networks in their current form (known as macrocells) have simply approached the limits of physics,” Rayment added. “Capacity gains at this point can only be incremental but mobile data demand is expected to grow 150 percent per year. A new mobile network paradigm, based on smaller cell sizes and the use of unlicensed Wi-Fi to augment licensed spectrum, is emerging as a remedy to reduce network congestion and deliver a great mobile broadband user experience.”

The Ofcom spokesman responded by telling eWEEK Europe UK that its proposals are just one of a number of measures it is taking to tackle this capacity overload.

Number of Proposals

“This spectrum trading measure is just one part of number of things we are doing,” said the Ofcom spokesman. “At the end of the month we will publish our competition assessment of the mobile spectrum market that will be used to influence the auction of 800MHz and 2.6GHZ auction this year. Releasing more of that spectrum is likely to give operators more capacity and ease any congestion issues they may have.”

“Another element is the refarming of 2G spectrum, so that operators can use 3G technology across 2G networks,” said the Ofcom spokesman. “These are all a number of factors that in combination we hope will help ease congestion. The big thing however is to watch out for our competition assessment and proposals for the 4G auction at the end of month.”

Last month Kevin Russell, chief executive of mobile operator 3 UK, hit out at Ofcom’s plans to open up the 2G spectrum for use by 3G services. He claimed that the measures could “jeopardise the competitive environment” and even result in the company being sold.

He also called on Ofcom to take pre-emptive measures to prevent mobile giants O2 and Vodafone gaining the bulk of the spectrum below 1GHz.