Europe needs a big bang auction of 4G licenses- article in New Europe

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In a time when confronted with huge debt burdens, negative growth and record high unemployment, the wireless revolution is a golden opportunity Europe cannot afford to miss out on. The road back to recovery goes via the wireless economy, not via Keynesian stimulus spending. But this requires a political leadership that places the digital economy at the heart of Europe’s growth agenda. Otherwise these investments and new jobs will be created in regions such as Latin America or Asia or anywhere else in the world where the best conditions are available.

The Radio Spectrum Policy Program (RSPP), for which I was responsible in the European Parliament, is a first important step to make Europe a global leader in the wireless era. . The RSPP will play a crucial part in our efforts to deploy superfast mobile broadband and to connect these wireless devices. More frequencies and more capacity mean higher speeds and more growth. In less then 10 years, there will be 50 billion devices connected to the web and they all rely on spectrum – the invisible airways that transmits information to and from these wireless devices

Firstly, freeing up 1.200 MHz for mobile broadband by 2015 as stipulated by the RSPP is instrumental for taking Europe to a frontier position. The requirement to open up the 800 MHz band by 1 January 2013 is a crucial ingredient to successfully roll out 4G and stimulate the development of new services. Many EU countries have already delivered. However, more than 10 governments have asked the European Commission to receive derogations, thus postponing the allocation of more spectrum for the mobile sector.

This might be a derogation justified for technical reasons or it might be justified due to cross-border issues. But most importantly it is a derogation for more growth. Saying no to more frequencies for the mobile sector is like saying no to all the growth opportunities that springs from the wireless revolution.

Secondly, the RSPP also gives a clear mandate to the Commission to asses and report by 1 January 2015 if there is a need to harmonise additional spectrum bands. The obligation on member states to de facto report capacity requirements and their current use of spectrum is something they can not shy away from.

However, while the RSPP is a first important cornerstone of Europe’s wireless landscape, the exponential increase of mobile Internet services will soon lead to capacity constraints in our mobile networks. If Europe wants to take the global lead and create the right conditions for this economic growth to happen on our continent, we must do more.

A second digital dividend in the 700 MHz would be an important reform for growth, helping the EU to exit the economic crisis. We urgently need a political decision to ensure that the 700 MHz band is opened up for mobile broadband in all EU member states. The announcement from Commissioner Kroes to approve a mandate to ask the European Conference of Postal and Telecommunications Administrations (CEPT) to develop the technical conditions for wireless broadband in the 700 MHz band is only a first step.

We need a big bang, pan-European auctioning of 4G wireless services, with a limited number of licensees that collectively serve the whole territory of the EU. Licensees may well be the result of different consortium of telecom companies or consolidation between existing players in different countries. Member states should make their spectrum resources available to enable the launch of pan-European wireless service. This would also help manufacturers with sufficient scale to profitably launch their new devices. Today only 8 out of the top 10 handset makers are European.

The 700 MHz band is already available for use by mobile Internet in large parts of the world, not the least in the US. Our policies must be future looking instead of conserving old structures. Outdated business models that have not kept pace with the speed of development must not hinder the development of more growth and jobs in Europe.

Europe needs to act now if we want to transform the competitiveness of our industries and our services sector, if we want the telecom and Internet industry to prosper and invest in Europe, if we want to kick start European economy out of the crisis, if we want to attract investments from all over the world.

If we do not embark on ambitious reforms now, and if we only aim to be the world’s number three, the wireless revolution will happen outside the EU. This would be very bad news for Europe.

Gunnar Hökmark is the rapporteur in the EP on regulations on radio frequencies, as well as vice chairman in the EPP Group


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