Editorial: British Auction Proposal Sets Bad Precedent

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  Space News Business

Editorial: British Auction Proposal Sets Bad Precedent

posted: 15 May 2006
10:08 am ET


Editorial

T he motives behind the British government’s proposal to auction off L-band radio spectrum that international regulators have set aside for satellite services may be murky, but the satellite industry’s dissenting rejoinder must be the exact opposite: loud and clear.

Satellite operators, manufacturers, service providers and ground-equipment suppliers have until June 9 to formally register responses to the auction being planned by Britain’s Office of Communications (Ofcom). They should do so with a united voice of unambiguous opposition.

There is far more at stake here than the particular chunk of radio spectrum in question: This is about predictability for anyone planning a satellite service that crosses national boundaries, as most do. If Britain goes forward with this auction, which would occur in early 2007, it will encourage other countries to disregard international spectrum allocations for satellite services, making it all but impossible for companies to raise financing for, let alone operate, such services.

The bandwidth Ofcom wants to sell is the 40 megahertz in between 1452 and 1492 megahertz in the L-band portion of the radio frequency spectrum. The upper 12.5 megahertz of that spectrum has been reserved by the U.N.-affiliated International Telecommunication Union and the European Conference on Postal and Telecommunications Administrations for digital satellite radio services.

Britain did not accede to this allocation, however, and is free to use the spectrum as it sees fit within its national boundaries. The problem is that radio signals do not stop at national borders. Satellite services are by their very nature transnational: All of Western Europe, along with much of Africa, the Middle East and Central Asia, for example, can be covered by a single geostationary-orbiting satellite.

Ofcom concedes there will be severe technical constraints on any domestic terrestrial service that operates in the frequencies now at issue. The reason is the potential for interference between that service and satellite radio signals in neighboring countries such as Ireland or France.

To eliminate that possibility, the operator of the terrestrial service would have to weaken its signals substantially in border and coastal areas, thus rendering it useless for most applications one might envision. That undercuts Ofcom’s primary rationale for a spectrum auction, which is to help consumers by allowing them to take advantage of the latest in wireless communications technology.

Ofcom also might point to the very real problem of satellite companies reserving valuable spectrum, only to sit on it for years without making meaningful progress in launching a service. The fact that no strong contender has emerged in the European satellite radio market since the spectrum was set aside more than a decade ago could serve as a convenient case in point.

While it is true that satellite radio has, for various reasons, been slower to materialize in Europe than some had hoped, the early success of XM Satellite Radio and Sirius Satellite Radio in the United States has stimulated renewed interest in this arena. With several European companies now actively seeking investors for a satellite radio venture, it makes sense to give them more time to put together a business. And certainly any satellite radio service serving Europe is likely to want to serve customers in Britain as well.

Besides, the decision to reallocate radio spectrum is one that usually is best left to international regulatory authorities, especially in instances such as this where one country’s unilateral actions would have a measurable impact on its neighbors.

Ofcom floated the auction proposal last October and drew protests from several companies including Inmarsat, which has no apparent designs on the frequencies in question but recognizes the dangers of unilateralist spectrum policies, especially for satellite services in densely packed Europe. The fact that Ofcom brushed aside these concerns in reiterating its proposal April 3 suggests that the industry perhaps did not make its case loudly and clearly enough.

Satellite companies have another chance, however. With the deadline for comments on Ofcom’s proposal just around the corner, the industry must mobilize now to respond with a unified voice and compelling arguments that no reasonable government body can refuse.