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Sunday, September 24, 2006

L-Band UK Spectrum Auction

There is a big auction coming up in the UK for the 1452MHz – 1492MHz spectrum (aka L-Band) in the first quarter of next year. Although, the L-Band was originally intended for Satellite use, it appears that OFCOM will conduct a technology agnostic auction.

Theoretically this spectrum could be used for a variety of services, but more than likely it will be used for MobileTV and there is a big potential for a battle of standards:
• BT is the main backer of the proprietary Movio standard which is based upon DAB technology. Korea also has a mobile TV solution based upon DAB standards called T-DMB. Arqiva is currently running a trial in London featuring comparing both of these technologies. I expect this consortium: BT & the Korean Government to be one of the bidders;
• Sky is also running a trial with Arqiva in Cambridge featuring another technology trial this time comparing the MediaFlo and DVB-H technologies. It will be extremely interested to see the choice that BT makes; and
• O2 have also recently run a trial of DVB-H in a single UHF channel in the 470Mhz-854MHz range. However, given that OFCOM do not currently plan to release the digital dividend UHF frequencies until 2012 and a likely competitor will be High Definition DTT services from the BBC, any strategy based upon this spectrum is probably doomed. The Spanish parent of O2 has heavily tested DVB-H technology as well.

I think BT and Sky are almost definitely going to bid and probably there is more than enough spectrum for two or even three broadcast networks for MobileTV in the UK however I doubt there is a business case for more than two networks. I see Qualcomm being quite comfortable in assisting with the Sky funding to get a foothold in Europe. Similarly I also see the Korean Government (via LG or Samsung) providing a helping hand for BT, if (and it is a big if) BT chose the Korean technology.

What will be interesting is to see whether a DVB-H alliance will step forward? I doubt whether Nokia would provide funding, although they would guarantee handset availability. Arqiva could theoretically get together with a cash strapped broadcast network (eg ITV) and offer to build the network if a couple of operators would sign-up in a partnership.

I would say the decision of Sky would be the most interesting, after all they have the data of the success (or not) of the MobileTV promotional on Vodafone and more importantly they have years of experience of DVB technology with Sky’s digital satellite based upon a variant of the technology. Likewise BT will have a few months experience of actual consumption of MobileTV services after the launch on Virgin Mobile. I seriously doubt whether this is a long term solution because of spectrum limitations in the Band III VHF frequency used by current DAB Radio broadcasting.

I doubt the auction is going to be a mega-earner for the UK government, but the partnerships and choice of technology will have huge long term consequences and will offer another interesting insight into the commercialization of technologies.