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E-GSM Public Consultation.Doc Seite 1 Concept for the Award of Further Spectrum for Public Digital Cellular Mobile Communications Below 1.9 Ghz (GSM Concept) Order 31/2005 Consultation for the award of further spectrum for public digital cellular mobile communications below 1.9 GHz (GSM concept) After clearance of the so-called E-GSM bands (880 – 890/925 – 935 MHz) recently agreed with the Federal Ministry of Defence a further spectrum block of 2 x 10 MHz will be made available to the telecoms market for use by telecommunications services. The Regulatory Authority (RegTP) intends not to consider the regulatory award issues associated with the new block of 2 x 10 MHz in the 900 MHz band in isolation, but from the perspective of an overall strategy in light of current GSM mobile issues. In this context the matter of ensuring fair and sustainable competition as set out in section 2(2) para 2 of the Telecommunications Act (TKG) is just as important as the different periods currently limiting the use of GSM licences in time and the technological change in the mobile market. With this overall strategy in mind, RegTP has drafted a concept for the award of further spectrum for public digital cellular mobile communications below 1.9 GHz (GSM concept), which will serve as a basis for various regulatory decisions to be taken in the near future. The concept is based on the "Strategic Aspects of Spectrum Management" paper (cf RegTP's paper which can be downloaded at http://www.regtp.de/reg_tele/start/fs_05.html). The GSM concept is one of a number of concepts on current issues of frequency regulation which will eventually be part of an overall frequency management strategy covering all forms of wireless access and taking account of the foreseeable convergence of the telecoms markets. The overall strategy will consider all frequency bands of public mobile communications and those bands of the fixed service which can be used for portable or nomadic applications. This future overall strategy for wireless access to telecommunications services will be drawn up on the basis of the frequency regulation criteria as described in the "Strategic Aspects of Spectrum Management" paper (loc cit, p 10). Among these regulatory criteria are in particular more flexible frequency usage conditions which should give due regard to existing usages (keywords are convergence, the principle of technological neutrality and efficient use of frequencies). Alongside technical and regulatory aspects relating to frequency requirements, competitive aspects must be taken into consideration because they may be of particular importance to the award of frequencies. The amount of spectrum which is or can be provided for a particular use will, among other things, be relevant to the issue of scarce frequency resources (section 55(9) and section 61 of the TKG) and thus to the kind of award procedure chosen and not least to the costs of acquiring spectrum as a resource. On the other hand, applications (such as GSM and UMTS/IMT- 2000) will only be competitive if they have sufficient spectrum and optimum technical conditions available. Accordingly, the GSM and UMTS concepts which are currently being prepared and the future overall strategy on wireless access will have to be developed with a view to avoiding scarcity scenarios as far as possible and allow quick, transparent and unbureaucratic frequency award procedures to be applied. So as to give the market a most comprehensive overview and provide the transparency needed for future spectrum award, RegTP decided to open a consultation on the availability of UMTS spectrum at the same time and in the same Official Gazette as the following consultation on the award of further spectrum for public digital cellular mobile communications below 1.9 GHz (GSM concept) (cf Order 33/2005). By opening simultaneous consultations on award procedures in different public mobile bands, RegTP is seeking to avoid, if possible, artificial frequency shortages which may occur when frequencies are awarded in parts. C:\WINNT\Profiles\124-1a\Local Settings\Temporary Internet Files\OLKA\E-GSM public consultation.doc Seite 1 Concept for the award of further spectrum for public digital cellular mobile communications below 1.9 GHz (GSM concept) I. Situation In Germany the digital cellular market was opened step by step by competitive bidding early in the nineties (section 2 of Telecommunication Installations Act (FAG) and sections 10 and 11 of the 1996 TKG). The mobile market was the first to be released from Deutsche Bundespost's monopoly of the time (voice telephony and telecommunication installations monopoly), a step which aimed at opening competition with Deutsche Bundespost Telekom in this market segment for the first time (known as "marginal competition within the monopoly"). At the beginning of the nineties Deutsche Telekom Mobilfunk GmbH (D1 network) and D2 Mobilfunk GmbH (D2 network) were granted the right under section 2 of the FAG to operate mobile networks (cf Official Gazette of the Federal Ministry of Posts and Telecommunications (BMPT) of 5 December 1994, p 866ff). Both companies were assigned frequencies from the 900 MHz band. In 1994 E-Plus Mobilfunk GmbH (E1 network) was licensed under section 2 of the FAG (cf BMPT's Official Gazette of 5 December 1994, p 880ff). The company was assigned frequencies from the 1800 MHz band. In 1997 Viag Intercom – called O2 today – was granted a licence under the 1996 TKG (E2 network) as the fourth GSM mobile operator and was assigned frequencies from the 1800 MHz band (cf BMPT's Official Gazette of 21 May 1997, p 679ff). The D network licences will expire on 31 December 2009, the licence of E-Plus Mobilfunk GmbH is limited to 31 December 2012 and the O2 licence will end on 31 December 2016. In accordance with the different market entry dates the licences are thus valid for different periods of time and based on different legal frameworks applicable at the respective time. There are however differences other than those referred to above in the GSM mobile networks, which are also due to successive licensing. In particular the spectrum blocks allocated to the individual licences varied considerably: When the mobile communications market was opened, spectrum from the 900 MHz band was initially made available in accordance with European harmonisation. The spectrum blocks allocated to the two D network operators were 2 x 12.4 MHZ each from this band. The E network operators licensed at a later date were granted spectrum blocks – meanwhile harmonised - of 2 x 22.4 MHz each from the 1800 MHz band since 900 MHz spectrum was no longer available at that time. In 1999 the GSM network operators were allocated further spectrum blocks, which had been cleared in the 1800 MHz spectrum, as extension spectrum (complementary spectrum) for existing networks (cf Ruling by the President's Chamber of 21 June 1999 on the conditions governing the award of further spectrum for mobile applications according to the GSM 1800 standard, RegTP's Official Gazette of 30 June 1999, p 1751ff). At an auction held in October 1999 D network operaters bought approximately equal shares of these frequencies; they have blocks of 2 x 17.4 MHz each now, allowing them to use both the 900 MHz and the 1800 MHz band. C:\WINNT\Profiles\124-1a\Local Settings\Temporary Internet Files\OLKA\E-GSM public consultation.doc Seite 2 II. Re GSM concept: The frequency bands 880 – 890/925 – 935 MHz which are designated as E-GSM bands (GSM extension bands) and comprise spectrum of 2 x 10 MHz are the subject of frequency usage subplans 226 and 227. The plans which are the basis for frequency assignments under section 55(1) sentence 3 of the TKG are dedicated to the E-GSM bands which can be used for military applications. After RegTP had specifically pointed out to the Federal Ministry of Defence that there was an urgent demand for E-GSM bands in the market, the Ministry relinquished its right to use these bands for military applications in March this year and gave its agreement to clearance as required by section 52(3) of the TKG. The E-GSM bands can thus be made available to the telecoms market in line with market requirements as soon as the relevant subplans regulating frequency usage have been modified, and military use has been replaced by civil use under the Frequency Usage Plan. So as to accelerate the process of providing this spectrum as far this is possible, RegTP has revised draft subplans 226 and 227 which contain the E-GSM frequencies. The two subplans are presented for consultation in Order 32/2005 of this Official Gazette at the same time as this concept. The revision of the two subplans - a prerequisite for frequency assignments in these frequency bands - will be completed by the autumn of 2005. Following completion of the formal drafting process, a further block of 2 x 10 MHz from the 880 – 890 /925 – 935 MHz bands will be available for award initially. However, the following concept will not only deal with the frequencies 880 – 890 /925 – 935 MHz, but with all GSM mobile uses below 1.9 GHz ranging to the UMTS band limit. The draft subplans dedicate E-GSM frequencies to "digital cellular mobile communications". Accordingly, the concept presented for consultation here also provides for E-GSM frequencies to be made available to GSM mobile communications. The E-GSM frequencies available now allow the different spectrum blocks allocated to GSM due to successive licensing to be distributed equally among the existing GSM networks and thus create more favourable regulatory prerequisites for fair and sustainable competition in the GSM mobile market within the meaning of section 2(2) para 2 of the TKG. E-GSM frequencies are therefore intended to be shared equally among the E networks which – contrary to D networks – have only had frequencies in the 1800 MHz band so far.
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