Digital Dividend Update July 2010

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Digital Dividend Update
July 28, 2010

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GSA Digital Dividend Update - July 28, 2010 Slide no. 1/30

Mass market Mobile Broadband
 Enabled by HSPA www.gsacom.com/news/gsa_304.php4

Facts from GSA reports

401 HSPA Operator Commitments in 154 countries/territories
353 commercial operators launched in 147 countries
including 63 commercial HSPA+ networks

98.8% of commercial WCDMA operators have launched HSPA

The majority (58%) of commercial HSPA networks support a peak downlink
data speed of 7.2 Mbps or higher

118 HSPA networks (one-third of commercial HSPA networks) have launched
HSUPA in 53 countries, with 41 networks supporting up to 5.8 Mbps peak

Source GSA Fact Sheet: 3G/WCDMA-HSPA, LTE: Network commitments, launches, devices, subs, spectrum
July 14, 2010: download for free the Fact Sheet and related detailed reports at www.gsacom.com



Mobile broadband drives need for more spectrum
 Industry forecasts massive mobile broadband growth

 Mobile broadband growth outpaces
every other platform**

 Pew estimates that by 2020, mobile
devices will be the primary Internet
devices for most people in the world***

 The average smartphone user
generates 10 times the amount of
traffic generated by the average non-
smartphone user*

** Source: CTIA, Written Ex Parte to FCC, Sept. 29, 2009
*** Source: Pew Internet & American Life Project, Dec. 2008
*Source: Cisco, VNI Mobile, 2010

More info on Mobile Broadband can be found at: www.gsacom.com


Digital Dividend - defined

Digital Dividend refers to the spectrum that becomes freed up as a
result of the switchover from analog to digital terrestrial TV

Digital Dividend spectrum is in the UHF range (200 MHz and 1 GHz) and excellent for
extending mobile broadband to rural and semi-urban areas. This spectrum band offers an
excellent balance between transmission capacity and distance coverage. It has very
good propagation characteristics i.e. improved in-building performance in built-up areas

Digital Dividend offers an unprecedented amount of spectrum which can be utilized for
extending mobile broadband services to all, including to the most rural areas, and to speed
up rollout. By applying the Digital Dividend for mobile broadband services, enormous
benefits will ensue around the world in terms of social impact and increased productivity



Opportunities enabled by the mobile industry

 New mobile services, with high quality video and interactive media for handheld devices
 Wireless broadband services, with high-speed data and voice services
 Wider coverage for advanced services in remote and rural areas
 Lower infrastructure cost, leveraging better propagation characteristics of UHF band
 Advanced business and broadcasting services, such as those used to support major
sporting events



Digital Dividend
 Digital switchover (DSO) dates

Already switched off
2010-2011
2012-2013
2014 onwards

Industry sources



Digital Dividend
 Frequency bands

New UHF Digital Dividend spectrum is becoming available in all regions

• Region 1 (Europe, Middle East and Africa) identified 790-862 MHz for mobile services

• Region 2 (Americas) identified 698-806 MHz

• Region 3 (Asia) mobile allocation is 470 – 960 MHz and 9 Asian Pacific nations
identified 698 – 806 MHz for IMT (Bangladesh, China, Korea (Rep. of), India, Japan, New Zealand,
Papua New Guinea, Philippines and Singapore)



ITU frequency regions

Region 1 Region 2 Region 3



Digital Dividend
 strategically important new mobile broadband spectrum

 WCDMA-HSPA is the leading mobile broadband system worldwide. Commercial systems
are deployed in 850, 900, 1700, 1800, 1900, 2100 MHz bands
 WCDMA-HSPA enjoys the largest economies of scale in mobile broadband
 LTE is the next evolution, standardized by 3GPP, for which significant amounts of new
spectrum will be needed to fully benefit its potential for the next step in user experience
 HSPA (including HSPA+) and LTE can be deployed in digital dividend spectrum
LTE is being deployed in 700 MHz Digital Dividend spectrum in USA, and 800 MHz band in
Europe (initially in Germany)
 Digital Dividend (700, 800 MHz) spectrum is highly valued for mobile broadband services
2.50 – 2.69 GHz band is best suited for capacity, and a perfect complement to DD spectrum



Digital Dividend
 700 MHz band is key for LTE deployments

 US 700 MHz LTE deployments include by Verizon Wireless, AT&T Mobility and some regional players
 Verizon Wireless has set up trial networks in Boston and Seattle and will launch commercial service in 25 - 30
markets by end 2010, with nationwide service by end 2013
 700 MHz spectrum availability is likely to extend throughout Americas
 In Chile, LTE trials are planned or already completed by Entel PCS, Claro and Movistar. Regulator
Subtel is expected to launch a 2.6 GHz auction in March 2011 (2.6 GHz, possibly also with 700 MHz)
 The Mexican regulator (Cofetel) is studying the feasibility of auctioning 700 MHz
 Policy makers in Brazil are discussing the potential of 700 MHz for extending broadband
 Industry Canada announced in its newly-released Annual Report plans to launch a consultation for
spectrum auctions in the 700 MHz and 2500 MHz bands, stating “Auctioning of these bands will help
support new mobile technologies and services”. The transition from analog to digital TV is scheduled for
completion August 31, 2011 More at http://www.tbs-sct.gc.ca/rpp/2010-2011/inst/dus/dus02-eng.asp#sec2.1.2
 The Indian government formed a task group to develop a national band at 700 MHz
 Consultations on the future use of 700 MHz have commenced in Australia and New Zealand


Digital Dividend
 DSO dates in Europe
Already switched over
2010
2011 - 2012
2013 - 2015
The European Commission places broadband connectivity for all
Europeans as a key policy objective, with wireless broadband a key enabler

“Every corner of Europe could reap this digital dividend“
(Viviane Reding, Member of the European Commission responsible for Information Society
and Media)

On May 6th 2010 the European Commission adopted a Decision
establishing harmonized technical rules for Member States on the
allocation of radio frequencies in the 800 MHz band that contribute to the
deployment of high-speed wireless internet services by avoiding harmful
interference.

The Commission will outline proposals on the next steps for the digital
dividend as part of the forthcoming Radio Spectrum Policy Programme
2011-2015 to be published at the end of June. This may include a
proposed target date by which all Member States must make 800 MHz
spectrum available for mobile broadband services

Note: Some regions of Austria and France already switched over to digital television. In
Belgium, the Flanders region has switched over to digital. Similarly, some regions of the UK
have already switched over to digital



790-862 MHz is the DD band in Europe
 Key developments (1)

Neelie Kroes, Vice President of the European Commission and European Digital Agenda Commissioner, has
emphasized the crucial need for a coordinated EU approach to radio spectrum. In her speech on June 23, 2010 to
the 5th Annual European Spectrum Management Conference in Brussels she expressed her desire for the 800 MHz
band spectrum to be released across the EU well before the 2015 deadline. She said that wireless broadband will
have a big role to play and that Europe needed harmonized frequency bands so that 1000 MHz of broadband
spectrum should theoretically be already available today. She took heart from the fact that some of the spectrum
used for national security and defence is being reassessed voluntarily.
Press release:
http://europa.eu/rapid/pressReleasesAction.do?reference=SPEECH/10/333&format=HTML&aged=0&language=EN&guiLanguage=en

According to a report by Spectrum Value Partners/Venture Consulting March 2008:
Europe could generate between €63 – €165 billion in additional economic value
using the digital dividend for mobile




 UK regulator Ofcom is preparing for a large auction of spectrum that will include channels freed up as part of
the digital dividend. The auction is expected to cover the 800 MHz, 900 MHz, 1800 MHz, 2100 MHz and 2600
MHz bands. On July 28, 2010 it was announced that the spectrum would be auctioned “as soon as possible”. The
bandwidth becoming available in the new frequency bands (800 MHz and 2.6 GHz) is expected to pave the way
for UK operators to launch LTE. Ofcom proposals will also allow operators to refarm existing 2G spectrum in the
900 MHz and 1800 MHz bands for new 3G services. At the same time the Minister for Communications, Ed Vaizey
announced funding for a compensation package to support Programme Making and Special Events users (PMSE)
who are moving out of the 800 MHz band, which will make a significant contribution to the costs of the PMSE
community in upgrading equipments to suit their new operating frequency (Channel 38).
BBC News story: http://www.bbc.co.uk/news/technology-10792404

 Telefonica-owned O2 UK has obtained a trial license from Ofcom to test LTE in the 800 MHz frequency band.
O2 will begin the trial in Q3 2010 in Carlisle (Northern England). One of the stated goals of the trial will be to
monitor for possible interference – if any - between mobile LTE services and broadcasters' services.
 Consumer trials of mobile broadband have been launched in Cornwall, England by Clear Mobitel using LTE
deployed in 800 MHz Digital Dividend spectrum. Company press release www.clearmobitel.com/press_release.html




 Romanian regulator ANCOM hosted an Eastern and South-Eastern European Telecommunications Regional
Think Tank entitled “Digital Dividend – Challenges and Opportunities in the Region” on 30th March in Bucharest
which included senior representatives of the ITU and regulatory authorities in Bulgaria, Croatia, Greece,
Hungary, Slovenia, Former Yugoslav Republic of Macedonia, Moldova, Serbia, Slovenia and Hungary, together
with leading industry players

 On 17th May 2010 NITA, the Danish regulator, published a consultation on future use of the so-called
MUX7, the 790-862 MHz band. Response to the consultation were due by 24th June.

 In Switzerland the Federal Communications Commission (ComCom) has instructed the Federal Office of
Communications to prepare the allocation of mobile radio frequencies including digital dividend spectrum. The
allocation of frequencies will take place by auction in 2010




Serbia's Ministry of Telecommunications and Information Society organized a ministerial conference in
Belgrade in June 2010 in order to consider at the regional level the use of the digital dividend. The informal
conference was attended by representatives of Albania, Bosnia-Herzegovina, Bulgaria, Croatia, Greece,
Hungary, Italy, Macedonia, Poland, Romania, Serbia, Slovenia and Turkey.

Serbia is targeting April 4, 2012 for the final switch over to digital television

In May 2010, Germany became the first country in Europe to auction digital dividend spectrum for mobile
broadband – see next page



Germany completes Europe’s first DD spectrum auction

Commencing on April 12, 2010, Germany's auction of radio spectrum ended on
May 20 with the total reaching EUR4.38 billion.

According to the final tally from the Bundesnetzagentur, T-Mobile, Vodafone and
Telefonica O2 each secured two 10 MHz blocks in the highly coveted 800 MHz
bands, which are expected to be used for LTE deployments.

The winning 800 MHz/DD bids were:
 Telefonica O2 (EUR1.212 billion)
 Vodafone (EUR1.210 billion)
 Deutsche Telekom (EUR 1.153 billion)

The Ministry of Economics of the German state Hessen has unveiled results of a survey among the participants of
the mobile internet via a digital dividend pilot. It found more than 90% of the participants are satisfied with their
internet connection (only 32% before the pilot started). The pilot is a joint effort of Vodafone Germany, the Ministry
of Economics of Hessen, the State Media Office of Hessen and the Municipality of Hofbieber, and started in
October 2009 with 32 households and 15 businesses in Hofbieber as participants. The pilot offered them mobile
internet at HSPA speeds (up to 7.2 Mbps) using digital dividend (800 MHz) spectrum.



Germany Digital Dividend auction result
 German auction covered 360 MHz across four bands: 800 MHz (DD), 1800 MHz, 2100 MHz and 2600 MHz
 Bidders were Deutsche Telecom, KPN/E-Plus, Telefonica O2 and Vodafone. Auction commenced April 12, 2010
 800 MHz (DD) allocations were the most expensive; 6 x 5 MHz paired blocks (791-821 MHz and 832-862 MHz)
 Coverage obligations and restrictions including spectrum caps apply

After 224 Rounds the auction
closed on May 20, 2010 and
generated € 4.384 billion

www2.bundesnetzagentur.de/frequenzversteigerung2010

The 800 MHz spectrum raised
(€ 3.576 bn) i.e. over 81.5% of
the auction‟s value




In Germany, operators have been trialling HSPA and LTE using Digital Dividend frequencies to provide
broadband services to communities without existing broadband possibilities. Auctions for mobile spectrum have
now ended (more details can be found in earlier pages)
Vodafone Germany has been testing LTE over the Digital Dividend band (790-862 MHz) and network deployment is to
begin in September 2010, extending to around 1,500 base stations during 2011. Infrastructure vendors have been selected
 Deutsche Telekom plans to begin a “friendly user trial” of LTE in newly acquired 800MHz spectrum in underserved
areas in Germany by the end of this year

 In Austria on December 29, 2009, the Regulatory Authority for Broadcasting and Telecommunications (RTR)
commissioned a study to evaluate potential uses of the "digital dividend“ from an economic perspective and to
develop recommended actions. The study was due for completion by end March 2010. The Austrian government
has decided to allocate the 790-862 MHz band to mobile broadband. In a joint announcement in late April, the
Minister for Infrastructure, Doris Bures, and the Secretary of State for Media, Dr Josef Ostermayer, stated that the
digital dividend frequencies would be auctioned at the end of 2011 or start of 2012
 Czech Republic regulator CTU has undertaken a 2nd round of consultation on the 470-862 MHz band.
 Slovenia is progressing with digital switchover and expects to complete this by the end of 2010




In Slovakia the Ministry of Transport, Posts and Telecommunications closed its public consultation on future use of
790-862 MHz spectrum on 7th May 2010
 In Spain, analog switch off was completed on April 3, 2010. Four days earlier, a Royal Decree committing Spain
to using 790-862MHz for mobile broadband was approved by the Executive, as part of a process licensing three
national private broadcasters to use DTT in lower frequencies. Broadcasters have until 2015 to clear the band.
 In Portugal, public consultations on the Digital Dividend closed on May 13, 2009. In a statement on its website on
August 5, 2009 the regulator ANACOM confirmed that 17 submissions had been received and approved the report of
the public consultation. More information at www.anacom.pt/render.jsp?contentId=968548
 In Italy, Communications Undersecretary, Paolo Romani, announced that frequencies vacated during the analog
switch off will be auctioned
 Analog switch off in Croatia began for national broadcasters in January 2010 and will be completed nationwide on
October 5, 2010




 Belgium is undertaking a consultation on the Digital Dividend
 Poland, according to press reports, intends to auction digital dividend spectrum together with 2.6 GHz in Q4
2010. It is understood that some of the digital dividend spectrum is in use by the military
 In Latvia, analog television was switched over fully to digital transmissions on Tuesday June 1, 2010.
 In Russia, the Russian Ministry has stated that the price they have placed on moving ARNS services out of the
790-862 MHz sub-band is € 2bn. Politically, the decision to award the band to mobile has been made. At the
ComNews LTE Russia and CIS conference (May 25-26) in Moscow, Yuri Zhuravel, Head of the State Commission
for Radio Frequencies, made new statements, explaining how a firm plan to clear the 790-862MHz band was being
put in place and would be released by the end of this year. He also re-confirmed the Ministry of Communications‟
estimate of the cost for clearing the band at €2bn, and stated that clearing the band may be within 3 years.
 In Ireland, ComReg has completed a consultation into how digital dividend spectrum will be allocated. Digital
switchover is scheduled by end 2012. ComReg has published its response to the consultation on Ireland‟s Digital
Dividend policy and expressed its support for freeing 800 MHz frequencies from exclusive use by the broadcasting
industry, which will pave the way for using digital dividend spectrum for mobile broadband networks in Ireland.
ComReg is committed to encouraging innovation through its Test & Trial Ireland project, which will involve mobile
communications devices using the digital dividend spectrum



In Spain, the 2x 30 MHz of spectrum expected to be available for mobile services after January 1st, 2015 will be
auctioned in 6 blocks of 2x5MHz

Cable TV network operators in Spain are bidding for new radio frequencies that are due to be auction off shortly as
part of a spectrum refarming process. The cable operators, Euskaltel, Telecable, ONO and R are aiming to be able
offer both voice as well as mobile broadband services, reported EuropaPress. The sale covers radio spectrum in the
800 and 900 MHz and 2 1 and 2.6 GHz bands and is due to take place next year.

Nokia Siemens Networks and Nokia conduct first LTE call at 800 MHz
Nokia Siemens Networks and Nokia have jointly conducted what the companies claimed to the the world‟s first end-
to-end LTE data call with Nokia Siemens Networks‟ commercial equipment on the 800 MHz frequency band

Press release: www.nokiasiemensnetworks.com/news-events/press-room/press-releases/nokia-siemens-networks-and-nokia-conduct-first-lte-call-at-800



Digital Dividend
 More actions globally (1)

The US is leading the way in freeing up and allocating digital dividend spectrum.

The FCC completed the auction of 700 MHz spectrum in March 2008 and distributed the
spectrum to a variety of providers mainly via a technology-neutral approach. The final
switchover to digital TV occurred on 12 June 2009.

Meanwhile, the winning operators including Verizon Wireless are trialling LTE services on the
new 700 MHz spectrum now and are expected to launch commercial LTE services in 2010.



Digital Dividend

Caribbean regulators, policy specialists and professionals in the Broadcasting,
Telecommunications and wider ICT community met in Kingston from June 7/8, 2010 to
discuss the future of broadcasting in the Caribbean. One issue is the digital switchover,
which the chairman stated would provide an excellent opportunity to utilize the
country's bandwidth for social and economic development. The switchover from analog
to digital is likely to free up quite a bit of spectrum space. It will be how the digital
dividend is managed, and the extra space and opportunities [mobile, broadband and
third generation services] that are generated by virtue of switching to digital.

According to telecoms regulator Subtel's head, Jorge Atton, Chile is expected to hold
an auction for LTE licenses in March 2011. It is anticipated that the 700 MHz band will
be released for the auction as part of the "digital dividend" as analog television is
migrated to digital services.



Digital Dividend

The Indonesian Ministry is looking into allocating the 700MHz band (694-806MHz) for
mobile broadband

The Malaysian Communications and Multimedia Commission (MCMC) has launched its
„my Spectrum Plan 2010‟ consultation. This is a broad perspective consultation which
includes regulatory and policy framework topics as well as plans for future use of the
UHF band. The deadline for submissions was 6th July.

In Colombia, the Minister of Information and Communications Technologies, Daniel
Medina, stated in May 2010 that the 700 MHz band will be cleared in Q2 2010 and
spectrum will be made available for auction to incumbents and potential new market
entrants. The process will follow the proposed 2.5 GHz auction.



Digital Dividend
 More actions globally (4) Australia

On January 5, 2010 the Communications Minister published the “Digital Dividend” green paper in Australia. Analog TV
transmissions will be switched off by end 2013. The paper establishes a government target of 126 MHz of contiguous UHF
(694 – 820 MHz) spectrum. Achieving this will involve moving some digital television services to new channels. Responses
to the consultation were required by February 26, 2010 and more than 100 submissions were received. Another portion of
spectrum - in the 2.5 GHz band - may also be auctioned
The Australian Communications and Media Authority (ACMA) has subsequently announced it is to start a consultation on the
release of 126 MHz of ultra-high frequency (UHF) spectrum as part of the Digital Dividend. The consultation will start with a
public discussion paper in Q3 2010 setting out planning and allocation issues and options for new spectrum licences. The
Digital Dividend wireless spectrum will become available on December 31st 2013 when the switch over to digital television is
completed across Australia. The Government aims to auction the digital dividend spectrum in the second half of 2012.
According to a report by Spectrum Value Partners (April 2009), the expected net benefit for Australia is between $7-10 billion
generated from mobile dividend
A report published by Network Strategies “2.5GHz in Australia: The future deployment of mobile broadband services,”
examines the links between mobile broadband, productivity and the role of new spectrum in 700 MHz (Digital Dividend) and
2.5 GHz bands. The report estimates the gross productivity benefits from the 2 new spectrum bands i.e. 700 MHz/2.5 GHz
combination, to be in the region of $62 billion over the period 2013 - 2020



Digital Dividend

In New Zealand, The Economic Development Ministry has announced plans to make 112
MHz of UHF spectrum in the range 694-806 MHz available for mobile telecommunications
and has stated that it will decide on allocations of its digital dividend spectrum by the end of
this year. Analog broadcasts will be switched off once three-quarters of the population have
adopted digital television, or by 2015 at the latest.

Ghana is to switch of analog broadcasting services before the ITU international deadline of
June 17, 2015* helping to free spectrum which could be developed into a digital dividend to
be allocated to other services and for the use to connect the unconnected in remote areas
*ITU deadline for ending analog broadcasting in areas where cross-border interference is a problem

In India, The Telecom Regulatory Authority of India (TRAI) issued a pre-consultation on
“IMT-Advanced (4G) Mobile wireless broadband services” which mentioned digital dividend
spectrum amongst other aspects – the date for comments was extended to April 15, 2010
New spectrum, especially in the 700MHz digital dividend band, needs to be added to the
store, to help support rural services, in which 70% of the Indian population lives. Of the
current broadband base of 9m, only 5% are outside major cities.


Digital Dividend

Africa – Digital Dividend discussions took place at the South African Development
Community (SADC) meeting in Swaziland in February. It was agreed that 790-862 MHz can
definitely be allocated to mobile broadband by 2014. An ad hoc working group will be created
to recommend following the CEPT plan for 790-862 MHz. Other plans will also be considered
and SADC may support a wider band. The wider plan was due to be signed by SADC
Ministers at their meeting on 10th May 2010
(SADC Member States: Angola, Botswana, the Democratic Republic of Congo, Lesotho, Madagascar, Malawi, Mauritius,
Mozambique, Namibia, Seychelles, South Africa, Swaziland, United Republic of Tanzania, Zambia and Zimbabwe)

In Bangladesh the regulator, BTRC has held a consultation on its proposed National
Frequency Allocation Plan (NFAP). The NFAP proposes allocation of 698-806 MHz band for
mobile services and appears to support a band plan similar to that supported by local
operators in India. Discussions are also taking place on the possible allocation of spectrum in
the 700 MHz band for mobile services



Digital Dividend

Bahrain: The Telecommunications Regulatory Authority published a consultation document in
December 2009 on telecommunications spectrum, which included the UHF band and identified 790-
862 MHz as a candidate band for LTE in the proposed re-working of Bahrain‟s national table of
frequency allocations. Comments were due February 14, 2010

Mexico’s telecoms regulator COFETEL has announced that during 2010 it will carry out an
assessment of the possibility of licensing the 700 MHz band for 4G services. The initiative follows
a 700 MHz spectrum tender proposal from the Mexican Ministry of Communications and
Transport (SCT). Cofetel has also announced auction rules for bidding for an additional 120MHz
of spectrum in the 1.7 and 1.9 GHz bands.

At the Asia-Pacific Telecommunity (APT) meeting in Tokyo on spectrum issues at the beginning
of April it was agreed that an Asia-specific spectrum plan would be developed for the region to
help promote the deployment of UHF digital dividend spectrum. A pragmatic approach was
decided upon to develop a 2 x 45 MHz FDD paired spectrum band plan – see next page



Digital Dividend Asia Pacific
 The preferred option

The Asia Pacific Telecommunity Wireless Forum (AWF) preferred FDD option is a 2 x 45
MHz plan, duplex direction is to be finalized, center-band gap is 10 or 11 MHz, and there is
some room for guard-bands at either end of the range 698 MHz and 806 MHz

 APT Wireless Forum report due in September 2010

 Ratification by APT Management anticipated in December 2010


Digital Dividend

Digital Dividend news and updates are appreciated please,

Send to the GSA Secretariat:

info@gsacom.com

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