SpectrumTrading

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A decision made (11/12/2008) to revoke decision MD-E-2008-0065 and to direct that spectrum trading is not extended to the Island and that there is a separate award process for the digital dividend.

Decision Reference: MD-E-2008-0237
Decision Summary Title:	Spectrum Trading		Date of Decision Summary:	10 December 2008
Decision Summary Author:	Jason Lane Director Regulatory Services		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Spectrum Trading		Date of Written Report:	9 December 2008
Written Report Author:	Jason Lane Director Regulatory Services		Written Report : Public or Exempt?	Public
Subject: Spectrum Trading
Decision(s): The Minister revokes his decision MD-E-2008-0065. The Minister directs that spectrum trading is not extended to the Island. The Minister directs that there is a separate award process for the digital dividend. The Minister directs the Director of Regulatory Services to request that Programme Making and Special Events management be part of the UK Band Manager’s Regime. The Minister directs the Director of Regulatory Services to confirm to Ofcom and the JCRA his decisions regarding the above, and authorises the Director to liaise with the other Crown Dependencies as required.
Reason(s) for Decision: The Minister, having noted there was no clear local industry view on spectrum trading, and having received new information from Ofcom indicating that available spectrum will be less than initially indicated, has reviewed his earlier decision MD-E-2008-0065. As a result he believes that Programme Making and Special Events management be part of the UK Band Manager’s Regime, whilst other parts of the award come under a separate, local process. This course of action is likely to result in greater benefits to consumers in Jersey as innovative services can be targeted to the local market. This would not preclude any interested parties from outside the Island from expressing interest in any award process.
Resource Implications: There are no financial or manpower resource implications with this decision.
Action required: The Director of Regulatory Services is to notify Ofcom and the JCRA of the Minister’s decision. The Director of Regulatory Services is to keep the process under review.
Signature: Senator P.F.C. Ozouf		Position: Minister
Date Signed:		Date of Decision:

SpectrumTrading

Economic Development

Regulatory Services

Spectrum Trading

One significant difference between Jersey legislation and the UK Communications Act is the provision for spectrum trading. Spectrum trading is a mechanism whereby spectrum licensed by Ofcom and paid for by a company, person or other legal entity may be traded (bought and sold) without having to undergo relicensing. The methodology is that the most efficient use of spectrum will come when market forces dictate utilisation and not through a purely regulatory regime. This seems attractive and acceptable as a concept, but it does give rise to a number of issues.

When the instructions were prepared for the 2003 Jersey Orders in Council, spectrum trading was deliberately omitted on the grounds that it was an untried or tested system and that the potential impact for Jersey could not be substantiated.

In February / March of this year, Ofcom was predicting that this 'dividend' would be quite significant and, on that basis a recommendation was made to extend spectrum trading. This was endorsed through Ministerial Decision MD-E-2008-0065 with the caveat that the Director of Regulatory Services continues discussions with Ofcom to confirm that this was in the Island's best interests.

Volume of trading in the UK, according to information received from Ofcom, has so far been relatively low. They suggest that this might be for a number of reasons but it is not unexpected that it should take time for a new market in spectrum to develop; and it is possible that the volume indicates that spectrum is generally already in the hands of those who, for the present, are generating greatest benefit from it. Ofcom has stated that trading volume has never been seen as a touchstone for the policy and Ofcom remains convinced that spectrum trading has a valuable role to play in securing maximum benefits from spectrum over time while recognising that circumstances in the Crown Dependencies may differ from those in the UK.

Subsequently Ofcom has advised that much of the cleared spectrum in the Channel Islands will have very significant constraints placed upon it under the GE-06 Plan, which regulates frequency usage in the broadcast bands of Europe, Africa and parts of Asia. The Geneva 2006 (GE-06) Agreement establishes frequency plans for analogue and digital environments in these regions with the status of a binding international agreement.

The situation is further complicated because a definitive assessment of potential interference from France cannot be made until France finalises its own digital switchover plan.

At this stage Ofcom was informed that a targeted consultation needed to be undertaken with local spectrum users and the JCRA. The responses showed that there was no clear industry view.

The other two Crown Dependencies have taken separate routes on this issue. The Isle of Man has opted out of the award process with the exception of Programme Making and Special Events, which is a specialised band on a small scale and with small power usage. They are generally not commercial and typically include loudspeaker transmitters in churches, public meetings and the like.

Guernsey on the other hand has currently opted to take on spectrum trading en bloc as per the UK and would thus form part of their larger market.

Based on this information the Department has recommended that Programme Making and Special Events management be part of the UK Band Manager’s Regime, whilst the Minister has directed that other parts of the award come under a separate, local process. It is the view that this is likely to result in greater benefits to consumers in Jersey as innovative services can be targeted to the local market. This would not preclude any interested parties from outside the Island from expressing interest in any award process.

To that end the Minister is recommended to revoke the decision of MD-E-2008-0065 and proceed accordingly.

Jason Lane

Director of Regulatory Services

9 December 2008