What is spectrum?
10 March 2010
You can bet we'd all be talking about it as prime real estate - it's highly-valued, high-profile and can be used in many different ways.
But that is what has happened to the UK's radio spectrum - the airwaves on which all wireless communications rely. Without it, planes couldn't fly safely, the emergency services wouldn't be able to operate and we wouldn't have television, radio, mobile phones, or sat-nav.
Our spectrum is limited in supply, highly sought-after and essential to modern economies. We are planning to release a large block of spectrum for new uses.
It is the 'sweetspot' of the radio waves because it can carry bandwidth-hungry services over wide geographic areas.
This prime spectrum is known as the digital dividend. It will become available as the UK switches from analogue to digital television between now and 2012.
Switchover will deliver many benefits to citizens and consumers in the UK.
It will allow universal access to the increased number of television channels available through Freeview. It will be able to take advantage of new technologies to allow high-definition services on Freeview, starting with the Granada region in late 2009.
The digital dividend is the third major benefit from switchover, with spectrum previously used for analogue television becoming available for a range of new services.
When it comes to releasing spectrum, our guiding principle has been to do so in a way that maximises the benefit its use brings to society. It is not our job to generate a windfall for the Treasury.
Some people have argued that Ofcom should decide who gets access to the spectrum and the services they should provide.
We don't think that a regulator trying to pick winners is in the best interests of citizens and consumers.
Why? Firstly, because there are many different uses of this prime spectrum, ranging from mobile television to high-definition television, from wireless home hubs to wireless microphones, from mobile broadband to local television and more. We cannot know which of these will deliver the greatest social and economic value.
Secondly, allocating spectrum in this way would tie it to specific users and uses, running the risk that the digital dividend remained stuck, unable to find its way into more productive hands.
Thirdly, and perhaps most critically, users who benefit from preferred access have little incentive to use spectrum efficiently. Spectrum is too valuable a natural resource to leave idle in the hands of those with no reason to make the most of its use.
Ofcom's approach gives freedom and incentives to spectrum users. This allows them to change who uses the digital dividend and how, over time and as consumer demand changes and technology evolves.
It will ensure that those who can innovate, who can develop the latest technologies and offer the services that consumers need, want and value can access the spectrum.
It will lead to more competition in the provision of wireless services, with the potential for greater choice and lower prices.
And it will deliver a significant contribution to the UK as it is estimated that the overall economic benefit from the use of the digital dividend is likely to be billions of pounds over the next 20 years.