ERG-RSPG Joint Session February 27, 2008 G öteborg

QuickTime™ et undécompresseur TIFF (non compressé)

sont requis pour visionner cette image.

ERG-RSPG Joint SessionFebruary 27, 2008

Göteborg

« Broadband wireless as an alternative infrastructure? A prospective overview of

technologies, markets & regulation »

Gérard POGORELProfessor of Economics

TELECOM ParisTech (ENST)<[email protected]>

RSPG ERG Joint meeting Gerard Pogorel pres 080303

ERG-RSPG 27/2/2008 2<gerard.pogorel@telecom-paristech>



Wireless broadband as an Alternative Infrastructure?

Areas of tentative analysis

1. Technical functionalities, performances and services, as compared to fixed

2. Telecom markets definition and competition

3. Industry structure considerations

4. Regulation considerations




1. Roadmaps: Data rates=Mobile & Fixed technologies

Source: IDATE

10 Kbps

100 Kbps

1 Mbps

10 Mbps

100 Mbps

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

CDMA

GPRS CDMA 2000 1x

EDGE

UMTS Rel. ‘99

CDMA 2000 EVDO Rev. 0 HSDPA

TD-SCDMACDMA 2000

EVDO Rev. A

CDMA 2000 EVDO Rev. B

HSUPA

Mobile WiMAX

LTECDMA 2000

EVDO Rev. C Mobile WiMAX

Maximum downlink data rate

Flash-OFDM

1 Gbps

xDSL

FO

MOBILE




1a. Wireless roadmaps: UMTS -WCDMA / HSPA / LTE




1b. Wireless roadmaps CDMA 2000-UMB

Source: QUALCOMM




1c. Wireless roadmaps + WiMax




Question marks : Wireless

• LTE: 2009-10• WiMax: 30-70 megabits 60km• UMP

– Which is fastest, most efficient, and most cost-effective.

– Some vendors deny mobile voice efficiency to WiMax

• Uplink Data rate




Question marks : Fixed

• Fiber: Slow start (2007)

• Will it happen, when and how ?




Wireless vs. Fixed: functionalities

• If functionnally equal…

• Mobility wins? Lessons from voice telephony: depends where you start from

– Developed countries: hand in hand

– Emerging countries go wireless




Wireless broadband as an Alternative infrastructure?


1. Technical functionalities,

2. Telecom markets definition and competition

3. Industry structure4. Regulation



Extension of Worldwide Broadband Wireless




Wireless & Fixed: networks

• Converged offers• More Potential technical

complementarities – Femtocells accelerate switch to

voice on mobile; but need fixed broadband to connect femtocells back to core mobile networks (Source: Analysys, Idate)

• potential geographic complementarities




Wireless, Fixed Compared 2008

Fixed Wireless 3G+

Internet Access/pageWeather,sports, stocks, news

<1s <2s(end 2007: 70-80% have some access -> 30-40% use it/In Transition to full

Web access)

TV/Video 50+ channels Up to 50 channels+videos

Music downloads

5-10s 30-60s /audio file

Tests France Feb 2008




Wireless vs. Fixed: terminals

• The “3 screens”: TV+PC+Mobile

– Different in Size, versatility, QoS, costs

– Are they

• Substitutes, or

• Substitutes & complements




Wireless as an alternative infrastructure: the voice telephony market analogy

ETNO Reflection Document RD274 (2008/01)?? Wireless broadband to be considered an alternative infrastructure when wireless voice is not, at least in most countries « …obviously different services both in terms of utility and of production »2 different markets, except in those countries where F&M are already substitutes:SEE ARCEP fixed telephony consultation document Feb 20




F & M literature see definition of relevant markets

convergence of termination rates literature

Technical dimension of Fixed & Mobile market distinction (ETNO ibid.):

•Switching and signalling sytems of mobile networks more complex than fixed•Geography of transmission links different: Mobile more costly•Capacity costs more traffic sensitive for mobile (does it matter)




An alternative infrastructure?

• Fixed Broadband trend: up, differ from fixed voice, down

• Relevant market test…

• Not there yet, but… Analysys




Wireless Revolution

• India 2007: – Internet connections via PC declined: Q1

9.27 million - Q2 9.22 million (Source: Telecom Regulatory Authority of India)

– Mobile Internet expected to reach 200million users in 2010 (Source: Indian Cellular Assn)





Areas of tentative analysis1. Technical functionalities2. Telecom markets definition and

competition

3. Industry structure considerations (vertical and horizontal integration), barriers to entry, bottlenecks

4. Regulation




Industry structure considerations

• Vertical and horizontal integration, barriers to entry

• Bottlenecks (access, origination and termination)

• How will the actors handle the development of fixed and wireless broadband?






1. Technical functionalities2. Telecom markets definition and

competition3. Industry structure

4. Regulatory considerations




4. The regulator’s Role

• Providing a competitive environment for innovation under heavily uncertain conditions

• Consumer interest

• Level playing field



Converging services: similar sets of services to be offered on fixed and wireless…

Converging regimes to be applied to Fixed and Wireless




Regulatory issues

• Ex ante/ex post

• Convergence

• « bottlenecks regulation »– Access, Origination, Termination)

• ?? access to radio spectrum: differences in licensing and authorisation regimes




4.1. Legacy Spectrum issues/3G Licences

price? Country 3G Holders Price per licence

(EUR) Spectrum FDD + TDD Method

Denmark TDC

Telia Denmark

Orange

H3G

0.127 billion

0.127 billion

0.127 billion

0.127 billion

2x15MHz + 5MHz

2x15MHz + 5MHz

2x15MHz + 5MHz

2x15MHz + 5MHz

Sealed bid process

France Orange France

SFR

Bouygues Telecom

619 million, plus a 1% tax on UMTS revenues

2x15MHz + 5MHz

2x15MHz + 5MHz

2x15MHz + 5MHz

Beauty contest

Germany Vodafone D2

T-Mobile Deutschland

E-Plus

O2 Germany

Mobilcom*

Quam (3G Group)

8.4 billion

8.5 billion

8.4 billion

8.4 billion

8.4 billion

8.4 billion

2x5MHz + 5MHz

2x5MHz + 5MHz

2x5MHz + 5MHz

2x5MHz + 5MHz

2x5MHz + 5MHz

2x5MHz + 5MHz

Auction

Italy TIM

Vodafone Omnitel

Wind

ISPE2000

Andala (H3G)

2.417 billion

2.448 billion

2.427 billion

2.442 billion

2.427 billion

2x10MHz + 5MHz

2x10MHz + 5MHz

2x10MHz + 5MHz

2x15MHz + 5MHz

2x15MHz + 5MHz

Hybrid: auction and beauty contest

The Netherlands

KPN Mobile

Vodafone (Libertel)

Orange (Dutchtone)

Telfort

T-Mobile Netherlands

0.7 billion

0.7 billion

0.4 billion

0.4 billion

0.4 billion

2x15 MHz +5MHz

2x15 MHz +5MHz

2x10 MHz

2x10 MHz

2x10 MHz

Auction

Spain Telefónica Moviles

Vodafone Spain (Airtel)

Amena

Xfera

0.13 billion

0.13 billion

0.13 billion

0.13 billion

2x15MHz + 5MHz

2x15MHz + 5MHz

2x15MHz + 5MHz

2x15MHz + 5MHz

Beauty contest

The UK Vodafone UK

O2 UK

Orange UK

T-Mobile UK

Hutchison 3G UK

9.85 billion

6.65 billion

6.75 billion

6.61 billion

7.23 billion

2x15MHz + 5MHz

2x10MHz + 5MHz

2x10MHz + 5MHz

2x10MHz + 5MHz

2x15MHz

Auction

An average value of10 EUR per pop

(upfront payment only)

A maximum value of164 EUR per pop

A maximum value of106 EUR per pop

An average value of23 EUR per pop

An average value of3.2 EUR per pop

Source: IDATE




What price level spectrum?

•Current Price levels of WiMAX licenses in the 100s mil €

•More reasonable and in line with use of limited resource

The easier spectrum access, the closer we get to a wireless alternative infrastructure




20022002 2003 2004 2005 2003 2004 2005 20062006 2007 2007 20082008 20092009 20102010 20112011 2012 2013 2012 2013 2014 2014 20152015 2016 2016

SDR:Full dynamic spectrum allocation from 2015.

SDR: Soft upgrades for mobile devices from 2011.

Multiple standards in mobile devices (GPS, WiMAX, 3G, WiFi).

UWB: 50 models of UWB devices approved by the FCC since 2002.

Cognitive radio: Full dynamic spectrum allocation from 2015.

USA: FCC approval in 2002

Europe: Power spectral density mask still debated.

No dedicated frequency bands for ETSI, ECC and ITU.

Harmonized standard in 2006 or 2007.

Cognitive radio: Smarter cognitive radios techniques from 2010. (DECT already available )

Antennas technologies: No previsions regarding wideband and reconfigurable antennas.

MIMO is expected to be deployed in commercial networks in the 2008 timeframe.

SDR. Many experiments. Platforms capable to connect into WLAN (802.11) or UMTS (W-CDMA) networks, or to act as HDTV receiver.

Wired remote upgrade in base stations from 2007.

Mesh networks. Many experiments.

MIMO. Prototypes.Pre-standard MIMO equipments are already available. MIMO applications will be part of the IEEE 802.11n High-Throughput standard which is expected in mid 2006

Network integration / Roll out & Commercial Launch Available

Timetable Estimation for Technologies Development Source: SPORTVIEWS-IDATE




“Cluster” approach proposed in Digital dividend document……

Given the strong interaction of frequency band, service application, and technology assessment, which constitute the basic foundation of the choice of a spectrum management regime,

we propose to operate those choices for each “cluster” of consistent and relevant band/service/technology

Cluster

Frequency bands Technologies Services




“Cluster” approach proposed in Nov 23 Digital Dividend document……

…To be extended to fixed-wireless convergence

Alternative infrastructures: Neutrality of regulatory framework




Unleashing the innovative potential of Fixed & Wireless technologies

by Fixed-Wireless “cluster” regulation

1. Technology: neutral2. Usage Rights Definition: consistent3. Licence/Autorisation Assignment

Modes: coherent in EU

-> Towards global authorisations/ licences ?




• Spectrum regulation is key



Thank You

ERG-RSPG Joint Session February 27, 2008 G öteborg

Documents