Coleago Consulting CEO Stefan Zehle discusses the implications of the EC’s decision to give more spectrum for 4G services. The EC announcement means 3G spectrum in the 2.1GHz band must be reassigned for 4G by June 2014. How, as it claims, do two technologies in one band increase harmonisation?

Stefan Zehle: Harmonisation is an essential ingredient to drive economies of scale, avoid technology barriers to competition within markets and enable international roaming.

However, an unavoidable consequence of this decision is that in the short term it will lead to a less harmonised world rather than increased harmonisation.

While Member States are obliged to allow operators to introduce LTE in the 2.1 GHz band, the timing of this will depend on the ramp down of 3G/HSPA traffic in the network of individual operators and the availability of LTE band combinations in handsets, tablets and other devices.

Can you provide an example of the lessening of harmonisation?

There will be a short-term impact on the ability of operators to utilise the capacity in new LTE bands.

An example is the unfortunate choice of LTE band combinations in the European version of the iPhone5, which incorporates only one of three LTE bands deployed in the Europe.

The issue is not trivial because iPhones, which generate vast amounts of data traffic, account for around 20 percent of smartphone sales in the EU but can only make use of LTE in the 1800MHz band.

What can the mobile industry do to overcome these restrictions?

Chipset vendors such as Qualcom as well as device manufacturers have to decide which technologies and band combinations to incorporate in chipsets and handsets.

In the short term this results in uncomfortable compromises because only a limited number of LTE bands can be accommodated in handsets.

Ideally operators would sell handsets with the right sort of band combination; for example the Samsung Galaxy or handsets from HTC.

However, despite a higher price point, consumers are attracted to the iPhone, regardless of the LTE band combinations. 

It is also very difficult to explain the LTE band issue to consumers.

How important an issue is technology and band combinations in handsets for operators?

The evolution of the LTE device ecosystem, the diffusion of devices with different band combinations and LTE deployment in different bands follows an uneven and at times unpredictable path.

Combine the uncertainties surrounding inter-band aggregation to produce higher headline speeds, and this introduces increased complexity into the spectrum valuation problem.

Is there a sensible way to avoid these problems?

Unfortunately these problems are unavoidable on the road towards networks that only use LTE or LTE-Advanced. However, what matters is how they are managed.

There are not only problems for network operators but also for policy makers in maintaining a harmonised EU-wide service.

For example, in respect of access to emergency services, particularly in rural areas. In order to mitigate this problem some EU-wide measures may be necessary.

What solutions might be adopted to deal with the challenges of reassigning the 3G spectrum?

It is very costly to keep GSM – and later HSPA – going where there very few users.

We have been there before, when analogue mobile networks were switched off, but mobile penetration was low then whereas now it is universal.

One solution might be that each country designates one mobile operator to keep GSM alive until a final “sunset” date.

The cost of this could be borne jointly by the industry so that an individual operator is not disadvantaged. 

A universal service obligation (USO) mechanism could be put in place to allow operators to bid for the role of the legacy network provider with the bidder who asks for the lowest subsidy winning the USO contract.

Such measures may accelerate refarming to LTE, thus maximising spectral efficiency while maintaining an EU wide legacy service for an appropriate time.

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