Radio Spectrum Five Year Outlook :
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- Imogen Ami Collins
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1 Radio Spectrum Five Year Outlook : Consultation Draft Summary of Submissions and Ministry Responses ISBN:
2 The opinions contained in this document are those of the Ministry of Business, Innovation and Employment and do not reflect official government policy. Readers are advised to seek specific legal advice from a qualified professional person before undertaking any action in reliance on the contents of this publication. The contents of this discussion paper must not be viewed as legal advice. The Ministry does not accept any responsibility or liability whatsoever whether in contract, tort, equity or otherwise for any action taken as a result of reading, or reliance placed on the Ministry because of having read, any part, or all, of the information in this discussion paper or for any error, inadequacy, deficiency, flaw in or omission from the discussion paper. 2
3 Table of contents Executive summary... 5 Section A: Overview... 7 A1. Spectrum management objectives... 7 A1.1 Efficient infrastructure and policy facilitation... 7 A1.2 Making plans and ease of doing business... 7 A1.3 Technology... 7 A2. Management framework... 8 A2.1 Tenure of management rights... 8 A3. Stakeholder engagement... 8 A4. International treaty involvement Section B: Drivers for change B1. Efficient and effective provision of public services B1.1 Operations B1.2 Allocation methods B1.3 Regional spectrum allocations B1.4 Secondary markets B2. International harmonisation B3. Established technology trends B3.1 Analogue to digital transition B3.2 Changes in usage B3.3 Satellites B4. Emerging technologies B4.1 Spectrum sharing B4.2 Short range FM transmitters B4.3 Wireless networking (WiFi) B4.4 Navigation and traffic systems B4.5 Electromagnetic near field devices B5. Industry specific trends B5.1 Telecommunications industry trends B5.2 Broadcasting industry trends B6. Compliance and interference issues
4 Section C: Key spectrum projects C1. Legislative amendments C1.1 Compliance and interference issues C1.2 Competition issues C2. Management framework C2.1 Conversion of radio licences to management rights C3. Digital switchover and the 700MHz digital dividend C MHz allocation C3.2 Digital switchover C4. International participation C5. VHF band III review C6. Crown asset management functions C7. Fixed services review C8. Emergency services / public protection and disaster relief C9. Documentation review C10. Transactional service delivery C11. Fees review C12. Operational compliance projects C12.1 Compliance of imported devices C12.2 Other operational compliance issues C13. Smart electricity networks Section D: Other issues raised by submitters D1. GPS transmission D2. Hearing aids D3. Medical peripherals D4. Public health concerns D5. VHF channels for use by hunters Appendix 1: List of submitters
5 Executive summary In 2012, The Ministry of Business, Innovation and Employment ( MBIE or the Ministry ) released a consultation draft of the Radio Spectrum Five Year Outlook, The consultation draft aimed to outline the Ministry s high level spectrum planning priorities for the next five years, thus providing stakeholders with increased certainty about the Ministry s future plans for radio spectrum allocation and management. The Minister for Communications and Information Technology ( the Minister ) expressed in her foreword to the consultation draft a desire for the Outlook to form a part of a process of developing a shared strategy for spectrum management to promote both sector-specific and economy-wide growth and innovation. The Ministry received 42 feedback submissions from interested stakeholders, ranging from large telecommunications companies and broadcasters to individual citizens with interests in particular aspects of spectrum management. This document summarises the submissions and provides the Ministry s responses. A final Five Year Outlook which takes into account the feedback will be published later in Appendix 1 presents a list of submitters. All submissions are publicly available on the Radio Spectrum Management website at Analysis of submissions identified the following common points: 700MHz digital dividend: telecommunications providers highlight the need to allocate 700MHz spectrum quickly, while broadcast submitters stress the disruptive effects of the digital switchover convergence: submitters identify ongoing technological and commercial convergence as a key feature of the spectrum users operating environment emerging spectrum demand for smart electricity networks greater forward planning/strategy: submitters encourage greater strategic planning and call for more extensive industry engagement market competition: many submitters consider that more attention should be given to market competition, including potentially establishing legislative competition safeguards. Some note the interrelationship of technological competition and market competition spectrum allocation methodologies: some submitters disagree with the use of auctions to allocate spectrum management rights white space use: submitters express enthusiasm about future technological developments in this area and note that white space use such as cognitive radio will potentially require modification of the current spectrum management framework. Other feedback themes include: concerns about availability of spectrum for Public Protection and Disaster Relief (PPDR) conversion of radio licences to spectrum management rights 5
6 interference and compliance possibilities for regional spectrum allocation satellite-related issues (particularly interference issues) further consultation and engagement, including with users/consumers hearing aid-related issues (requests for more spectrum) the potential public health risks of cell towers. Feedback from submitters will be useful in helping us determine the scope of the upcoming review of the Radiocommunications Act (1989), which will include its own dedicated consultation process. Feedback also brought to light some interference and compliance issues. In particular, we consider that the following items raised by submitters require our attention over the next five years: the potential spectrum requirements of smart electricity networks addressing potential interference and spectrum congestion issues for hearing aids. The Ministry is pleased that, on the whole, submitters support the radio spectrum management objectives, but we note that there are a variety of views on the extent to which current policies are achieving these objectives. While many useful points were raised by submitters, MBIE also notes some misconceptions about the responsibility for broadcast content. We suggest that concerns about broadcast content be directed to the Ministry of Culture and Heritage and NZ on Air, who hold the prerogative over broadcast content. The remainder of this document loosely follows the structure of the consultation draft, except where no submitters commented on specific sections. These sections are omitted. Ministry responses to feedback are in boxes. 6
7 Section A: Overview A1. Spectrum management objectives Submitters generally support the radio spectrum management objectives outlined in the Five Year Outlook: technological neutrality, flexibility, tradable spectrum rights, transparency, efficiency, and the certification of licences by private sector engineers. There is, however, disagreement about the extent to which current policies are achieving the stated objectives. Rural advocacy group Primary Focus suggests that MBIE make the primary objective for spectrum management "support of government policy outcomes in the area of economic prosperity for all New Zealanders." Emergency service providers, regional broadcasters, and public service broadcasting (PSB) advocacy groups all express concern that the consultation draft and MBIE generally are focussed on commercial and industrial uses of the radio spectrum, and these submitters consequently stress their view of the spectrum as both a public good in itself and a means of providing public goods. There are various important uses of the radio spectrum. MBIE is focussed on facilitating a high-performing economy to ensure New Zealand s lasting prosperity and wellbeing. The connectivity and communication that efficient and effective telecommunications provide are essential to this goal, and radio spectrum management is central to better connectivity and communication. A1.1 Efficient infrastructure and policy facilitation There is overwhelming support for technologically neutral management rights. InternetNZ and rural interest groups stress the importance of broadband access in rural New Zealand. A1.2 Making plans and ease of doing business Submitters support the intention of the Five Year Outlook to provide a clear path forward. Some suggest that five years is not long enough for forward strategic planning, while another argues that the fast pace of technological developments will require updating of the Outlook every two to three years. A1.3 Technology Submitters who comment on technological neutrality feel that it is an important objective. Many submitters argue that current policy and regulatory frameworks do not adequately reflect the trends of technological convergence in the telecommunications and media sectors. Some submitters suggest that the review of the Radiocommunications Act (1989) ( the Act ) should take place alongside a review of other spectrum-relevant legislation such as the Broadcasting, Commerce, and Telecommunications Acts; this would serve to better realise the goal of technological 7
8 neutrality and provide a comprehensive and coordinated legislative framework for the converged industry. See also section B5 for a more detailed summary and the Ministry s response. A2. Management framework Most submitters endorse the tradable property rights approach to spectrum allocation and the management objectives outlined in section A1 of the consultation draft. However, submitter Toa Greening suggests a shared spectrum arrangement, coupled with shared infrastructure, in which the Crown in partnership with Māori retains management rights to radio spectrum and licences its use to telecommunications providers. Public Protection and Disaster Relief (PPDR) agencies express concern that tradable management rights have inherent potential to lessen the amount of spectrum available for PPDR use. A2.1 Tenure of management rights MediaWorks, Telecom, and Vector suggest that MBIE consider shorter terms for management rights (ten or fifteen years) to better suit the rapidly changing technological landscape. They argue that this would help better realise the efficient use of spectrum. Satellite companies such as NewSat, on the other hand, argue that because of the significant long-term investment required to launch satellites and the difficulty of reprogramming their operating frequencies once in orbit, long-term certainty about spectrum use is essential for satellite frequencies. The current common twenty-year terms are the maximum allowed under legislation; shorter terms can and have been specified for particular spectrum bands. Radio technology has a fast pace of technological change. Within twenty-year management rights, flexibility exists through the potential for secondary markets. However, a much shorter length would in many cases hinder allocative efficiency, could create significant uncertainty for rights holders, and could lead to much higher administrative costs. The Ministry believes that the length of management rights should be considered on a case by case basis. In the past, longer lengths of management rights have facilitated easy and efficient transition to new technologies, such as from 2G to 3G cellular networks. Furthermore, the Ministry accepts that long-term stability is optimal for viable commercial satellites. Satellites are administered through the International Radio Regulations coordination process. New Zealand actively participates in this process and intends to continue doing so. A3. Stakeholder engagement Generally, submitters are pleased with the Ministry s engagement efforts, although some suggest that more would be beneficial. InternetNZ, the Coalition for Better Broadcasting (CBB), and the Regional Television Broadcasters Association (RTB), 8
9 identify a lack of engagement with end users and consumers who are left out of operations-focused engagement that focuses on industry stakeholders and large commercial spectrum users. Many submitters note that when it comes to planning for new technological uses of spectrum, getting it right is much more important than getting it done quickly. InternetNZ suggests that for future consultation, the Ministry develop scenarios based on different policy options and release these scenarios for consultation, thus helping stakeholders and the public to better comprehend the consequences of the Ministry s plans and options. Similarly, the RTB stresses that for consultation to better engage stakeholders and the wider public, it must be clear and promote common understanding of terminology and technologies. Some submitters express concern that feedback did not always succeed in changing the Ministry s view. InternetNZ expresses concern that consultation is usually operations focussed, rather than focussed on long term strategy. To this end, InternetNZ applauds the Five Year Outlook as a potentially strategic document, but some submitters express confusion around the exact strategic status of the Outlook, and note that five years is a short timeframe for long-term strategy. Broadcasters, PPDR agencies, and electricity companies all request more frequent industry-specific engagement and consultation. The RTB suggests the establishment of a shared forum of MBIE, the Ministry of Culture and Heritage (MCH), and broadcasters, which meets regularly to discuss broadcasters concerns. MediaWorks considers that the Ministry is better at informal consultation than it is at formal consultation. Similarly, the Radio Broadcasters Association (RBA) identifies a recent reduction in the level of consultation and engagement by the Ministry and stresses the important role of MBIE as a facilitator of consultation, information dissemination, and industrial consensus-building. The RBA also argues that sufficient time must be given for consultation, and that independent engineering analyses are invaluable to the consultation process. Kordia expresses satisfaction with the monthly Business Update e-newsletter and warns against using social media as an industry engagement tool. Many submitters request further consultation around areas of the Ministry s work programme specific to their own operations. Some note that technological and commercial convergence make the boundaries between traditionally different areas of operation unclear. 9
10 The Ministry considers that consultation is an important part of providing efficient and effective public services as an outward-facing organisation. The Ministry will continue to consult when necessary. Developing scenarios for easier public understanding in future consultation exercises may be useful. We welcome engagement at any time from interested parties and are available to meet on an ad hoc basis regarding specific issues. There are no current plans to replace the Business Update newsletter with social mediabased communication. A4. International treaty involvement Submitters support MBIE s involvement in the International Telecommunications Union (ITU) and World Radiocommunications Conferences (WRC), and note that the Ministry has usually accurately identified New Zealand s interests at these forums and acted appropriately to promote these interests. SKY TV suggests that the Ministry could do more to represent the interests of broadcasters at international forums. The Ministry seeks input from industry through the New Zealand Radio Sector when formulating the New Zealand position prior to major international conferences, and intends to continue doing so. 10
11 Section B: Drivers for change B1. Efficient and effective provision of public services Submitters support a number of initiatives to enhance efficiency, including cognitive/dynamic radio and white space use to address spectrum congestion. B1.1 Operations There is widespread support for online services such as SMART, and for the use of approved radio engineers and examiners, as well as recognition of the important compliance work undertaken by Radio Spectrum Management (RSM). B1.2 Allocation methods 2Degrees notes interpretive issues with the goal of efficiency, arguing that allocative efficiency often leads to market inefficiencies such as underuse of spectrum. Several submitters, including 2Degrees, InternetNZ, Primary Focus, the RBA, TeamTalk, Telco2, Toa Greening, TUANZ, Vector, Venture Southland, and PSB interest groups, argue against the use of auctions to allocate spectrum management rights. These submitters argue that while auctions can be an efficient way to allocate spectrum, they do not lead to efficient use of spectrum which, they argue, should be the Ministry s overriding concern. Submitters argue the following points: auctions promote spectrum hoarding, which leads to market inefficiencies and therefore does not facilitate economic development competitive allocation processes lead to duplication of infrastructure (such as cell towers), which has a high overall cost and therefore prevents investment in service delivery, and, some submitters suggest, potentially contributes to public health concerns around electromagnetic radiation as well as urban design issues auctions are founded on a "miscalculation of resources" because they assume only private benefit when, in the case of spectrum, public benefits also apply auction prices are either likely to be low because there are not sufficient bidders to drive up prices, or prices are too high to allow for new market entrants. InternetNZ submits that the most efficient, innovative, and beneficial use of spectrum in New Zealand has been in the 2.4GHz band under a General User Radio Licence (GURL), not in any spectrum bands allocated by auction. Venture Southland suggests the Ministry undertake research to evaluate the overall economic costs and benefits that have occurred from allocating spectrum via auction. Telecom and Vodafone support the use of spectrum auctions. Telecom argues that care must be taken to ensure spectrum allocations take place after international decisions on harmonisation and standardisation, not the other way around. Telecom cites the allocation of 3.5GHz spectrum as an example. 11
12 Vodafone recommends that the renewal of rights to 1800 and 2100MHz spectrum follows the same process as for 850/900MHz renewal, especially: right of first refusal to incumbent the offer price approximates the market price use it or lose it clauses the renewal offers are made at least five years prior to rights expiry dates. See also section C3.1. The Ministry notes these comments. We continue to believe that auctioning is a robust, fair, and beneficial method for allocating high-value spectrum, but stress that we do consider alternatives when deciding on allocation methodologies for particular spectrum rights. We note that spectrum auctions have become widespread internationally, and while this by itself is not a sufficient reason to continue to auction spectrum in New Zealand, it does suggest that the benefits of spectrum auctions are widely acknowledged. B1.3 Regional spectrum allocations Submitters views on regional allocation of spectrum management rights are varied. Telecom, Vodafone, TeamTalk, and some other submitters, support the introduction of regional management rights for broadband use in unused spectrum, to address concerns about hoarding and inefficient use of spectrum, especially in rural areas. While some other submitters support regional spectrum allocation in principle, they argue that Digital Terrestrial Television (DTT) will provide adequate spectrum for regional broadcasters, negating the need for regional spectrum allocations. They note that MBIE should identify costs and benefits of regional allocations in other countries. Vector points out that while incumbent national management rights holders might be willing to forfeit unused spectrum in rural areas for regional management rights, they re unlikely to do so in commercially attractive regions like Auckland. Primary Focus argues against national management rights, but does not promote regional allocation per se; rather, it advocates a shared-use spectrum regime. Generally, electricity companies do not support regional management rights. However, Powerco suggests that PPDR agencies could be allocated a nationwide block of spectrum and then left to distribute it regionally by their own method. InternetNZ suggests that dynamic uses of spectrum, GURLs, Managed Spectrum Parks (MSPs), cognitive radio, directional antennas, and software-defined radio, are potentially better options to address scarcity and congestion than regional allocation. Submitters who oppose regional management rights do so because of the potential resulting interference issues and high transactional costs, noting that spectrum does 12
13 not conform to geographic or regional boundaries. They also suggest that regional allocation could stunt the development of a national secondary spectrum market. MBIE considers that there could be economic benefits from regional provision of telecommunications services, gained through more efficient spectrum allocation and use, and greater competition and consumer choice. We will further consider creating the ability to allocate regional management rights in the upcoming review of the Radiocommunications Act. The Act currently does not allow for regional management rights; we will consider the potential benefits of regional allocation as part of our Act review. We understand submitters concerns about regional spectrum management rights. Regional management rights would be unlikely to apply to broadcasting, as broadcasters are already issued with regional radio licences in the Crownmanaged broadcasting spectrum bands. In the past, demand for regional management rights has come from local wireless internet service providers (WISPs) and smaller telecommunications companies. B1.4 Secondary markets Many submitters recognise the potential for active secondary markets under the management rights regime, but also note the lack of realisation of this potential. Vector suggests MBIE consider addressing the barriers to the development of a secondary market, while Vodafone argues that it is inappropriate to conclude that secondary trading is ineffectual just because little has occurred. The Public Service Broadcasting (PSB) advocacy groups argue that secondary markets are not adequate alternatives for reserved PSB spectrum because commercial holders of nationwide broadcast spectrum licences have expressed no willingness to make surplus spectrum available to other (public service or regional) broadcasters who could take away national commercial broadcasters audiences. The Ministry notes a number of recent secondary market spectrum transactions. B2. International harmonisation There is widespread support for New Zealand s position as a fast follower of international technology innovations. InternetNZ also argues that because of New Zealand s small population it is an ideal location for the testing of new technologies and market innovations, and that the fast follower position should not inhibit this. SKY warns of following too fast by prematurely allocating spectrum and thereby limiting options for future spectrum use. Similarly, Vodafone recommends that MBIE delay major decisions on spectrum reallocation until after the 2015 World Radio Conference (WRC15). While all submitters agree that international harmonisation is important, many stress that regional harmonisation within the Asia-Pacific region is also important, including 13
14 bilateral harmonisation with key trading partners. There is recognition that international forums are often dominated by the largest countries, which face different spectrum problems to New Zealand because of differing spectrum to population ratios. Some submitters argue that the economic benefits of international harmonisation, such as economies of scale for equipment, are increased by New Zealand s status as a tourist destination: it is important for tourists that their mobile devices work in New Zealand. Some submitters specifically identify issues and express requests in their own areas of operation, including satellite television, handheld radio, broadcast radio, medical peripherals, hearing aids, and emergency services. These are noted in more detail in other sections of this document. The number of used cars entering New Zealand with non-standard FM radio receivers is of particular concern to one submitter. The Ministry agrees that New Zealand s fast follower position means that international harmonisation is important to allow New Zealand consumers to take advantage of international economies of scale for equipment. We also agree that regional and bilateral harmonisation with key trading partners is important, in addition to involvement in the ITU. B3. Established technology trends B3.1 Analogue to digital transition Kordia supports MBIE encouraging land mobile operators to adopt digital technologies and requiring analogue users to change from 25KHz to 12.5KHz channelling, and suggests "a more proactive approach" in this area, given that Public Information Brochure (PIB) 58 requires discontinuation of analogue services by The Ministry has noted this suggestion. See also section C3.2: Digital switchover. B3.2 Changes in usage There is widespread recognition amongst submitters of technological convergence: the blurring of boundaries between broadcast and telecommunications services, providers, and devices, which is largely driven by technology but also by commercial innovations. InternetNZ notes that technology trends "continue to be disruptive - generally to the advantage of consumers and innovators rather than incumbent broadcast and telecommunications companies." Telecommunications providers and mobile technology manufacturers generally stress the increasing demand for mobile broadband and Internet Television (IPTV), leading to a call for more spectrum for mobile use and less for traditional broadcasters. They qualify this by stating that any decisions about future spectrum for mobile use should not be made until after the results of WRC15 are settled. 14
15 However, broadcasters argue that traditional broadcasting will not be replaced by internet-based broadcasting until well after the Five Year Outlook period, if ever. This is largely because of the ongoing digital divide and the monthly cost of a broadband internet connection relative to the one-off cost of a television. They tend to see internet-based broadcasting as supplementary to terrestrial and satellite broadcasting. One submitter notes the development of supplemental downlink technology and suggests it will help to solve the demand imbalance for uplink and downlink resulting from greater use of the internet to access entertainment media. InternetNZ stresses that the Ministry should differentiate between demand for true mobile (e.g. cellular mobile use in a moving vehicle) and semi-mobile (e.g. the WiFi-based use of a mobile device in a fixed location, such as using a smartphone while stationary in a café or public place) technology and services; the Ministry can affect consumer demand for true and semi-mobile services through spectrum allocation for cellular and WiFi networks. InternetNZ suggests that most consumer demand is for semi-mobile internet access, but that spectrum allocations in favour of cellular services will cause congestion in WiFi bands and push users into using more expensive, but less congested, true-mobile cellular-based services. Therefore cellular providers who gain 700MHz spectrum should in return offer up unused and underused spectrum above 2GHz for WiFi use. Regarding competition between WiFi and cellular spectrum for mobile and semi-mobile use, MBIE accepts that there is a potential trade-off between quality of service and price. See section B5 for further Ministry responses to the issue of convergence. B3.3 Satellites Satellite companies note the growing importance of satellite transmissions, including for mobile phone use, and express concern about interference to satellite signals from WiMax in the adjacent 3.6GHz band. SKY encourages MBIE to advocate internationally for the retention of current satellite broadcasting bands and the allocation of GHz to satellite broadcasting. Submitters suggest that "additional activity" will be required by MBIE in regard to satellite issues, specifically the planned use of Ka-Band for mobility ( GHz and 29-30GHz), the associated need to protect terrestrial systems, and sharing between fixed links and fixed gateway earth systems. They suggest that New Zealand follow other countries in developing new band plans for Ka-Band, and that if C-Band FSS spectrum is considered for mobile use (as WRC15 agenda item 1.1 suggests) then the needs of incumbent users such as earth stations must be fully protected. 15
16 The Ministry has noted these points. Current issues with interference in New Zealand in the GHz band from satellites not primarily intended for New Zealand need to be solved at international level. B4. Emerging technologies Some submitters argue that technological changes will require a complete overhaul of the current spectrum management framework, while others consider that more minor changes will be sufficient; all agree that changes of some degree are required. Submitters stress that the rights of existing spectrum users and services must be protected from interference by new uses. The Ministry encourages existing spectrum users to participate in the upcoming review of the Radiocommunications Act to ensure that their interests are fully taken into account. B4.1 Spectrum sharing B4.1.1 Ultra-Wideband technology Ultra-Wideband technology (UWB) did not draw much feedback. Telecom argues that UWB is only suitable for unlicensed applications. The RBA stresses that MBIE must ensure that the noise floor of existing bands is not raised by new UWB uses. The Emergency Telecommunications Services Steering Group (ETSSG) points out that Maritime New Zealand has recommended that New Zealand adopt the European Union s UWB standard, as the American standard has the potential to significantly interfere with VHF maritime distress signals, as well as the Fire Service s IGC and digital land mobile radio services. The Ministry has noted these points. B4.1.2 Software-defined radio Telecom states that software-defined radio is already in use in base stations, but its widespread availability in consumer devices is unlikely to occur soon because of high power consumption and limited software functionality. B4.1.3 Cognitive radio Cognitive radio, and white space use more generally, is widely seen by submitters as the emerging technology that is the most challenging to the existing spectrum management framework. Telco2 argues that while cognitive radio may at present be an emerging technology, it will be widespread by the end of the Five Year Outlook period and therefore should be MBIE s highest priority. Some submitters note that it is unclear how white space use would fit into the current spectrum management framework. Many submitters stress that care must be taken, to ensure that existing spectrum users are not disadvantaged by interference from white space devices. 16
17 Existing spectrum users tend to warn of the potential for interference resulting from white space use. Venture Southland notes that cognitive and software-defined radio have the potential to adversely impact on radio astronomy and amateur radio. Wireless microphones are a potential application for cognitive radio technology, but Wireless Users New Zealand (WUNZ) warns that currently the technology is costprohibitive for most wireless microphone users. 2Degrees suggests that investigation into white space use and potential interference issues should occur in Crown-managed spectrum. Kordia notes that New Zealand has a much denser Digital Terrestrial Television (DTT) channel plan than in Europe, which allows reuse of channels in almost 100 per cent of New Zealand areas, as opposed to per cent in Europe. Consequently, Kordia argues that there is much less opportunity for itinerant white space use in New Zealand than there is in many other countries. Kordia considers that the only opportunities for white space uses in New Zealand are: in geographic locations not covered by the DTT service areas (equalling 12 per cent of the population, mostly rural) in channels used for in-fill, but only in zones between in-fill coverage areas and with allowance for a sufficient exclusion guard area in vacant DTT channels on a temporary basis. Telecom, InternetNZ, and Telco2 all recommend revisions to the management rights regime to accommodate cognitive radio. Telecom cites the US Federal Communications Commission (FCC) example of allowing white space to be used for fixed broadband access. While the details of their suggestions differ, essentially all three suggest one of the following options: allowing white space use in spectrum held under management rights as long as it does not cause any interference, without charge or permission from rights holders issuing secondary licences or secondary use rights to spectrum, with conditions attached that secondary users do not interfere with primary users (for example, in locations where primary users cannot or will not use the spectrum that they hold rights to). 17
18 The Ministry is not convinced that demand for white space devices, and therefore spectrum, will grow as exponentially as some submitters suggest it will during the period covered by the Five Year Outlook. We note that wireless microphones have been suggested as a common application of white space technology, but the Wireless Users of New Zealand (WUNZ), who represent wireless microphone users, argue that the current cost of white space microphones prohibits their widespread uptake. An initial report by the Ministry about white space spectrum availability is accessible on the Radio Spectrum Management website at This report shows that there is a substantial amount of white space available in the TV UHF band, particularly in rural areas. The Ministry notes that the radical revision of spectrum management that one submitter suggests is required is in practice similar to the regime already in use for radio microphones in unused broadcast spectrum. This existing regime could be adapted to fit white space devices. We welcome approaches from anyone looking to provide white space services. B4.1.4 Mesh networks Some electricity companies submit that they will use mesh networking for smart electricity networks, and suggest that MBIE extend the licensing regime to cover these applications so that interference and congestion can be managed and avoided where possible. See section C.13 for the Ministry s response. B4.2 Short range FM transmitters One submitter requests a dedicated nationwide frequency for short range FM devices, such as the itrip, which are designed to transmit music very short distances from portable MP3 players to car stereos. The submitter argues that a dedicated nationwide frequency would allow users of these devices to use them on long trips without constantly having to retune the devices to avoid interference from local FM radio stations. Allocating spectrum for these devices would take the spectrum away from potential commercial users, resulting in an inefficient outcome. The Ministry considers that in most parts of the country there is sufficient available FM spectrum for these devices to work properly. An assortment of alternative devices for playing MP3 players through car stereos (such as tape-deck adapters, car stereos with AUX or USB inputs, or Bluetooth connectivity) also exist at a range of price levels. 18
19 B4.3 Wireless networking (WiFi) Telecom argues that the 2.4GHz band is increasingly congested and that another MHz should be freed up for WiFi use following WRC15. Powerco recommends extending the licensing regime to cover wireless networking, so that interference and congestion can be managed and avoided where possible. TeamTalk expresses surprise at the lack of mention of the 5GHz under general user licence used for wireless networking, and notes that different definitions of wireless LAN get used across the industry. The Ministry agrees with submitters that demand for WiFi spectrum is likely to increase, but notes that international harmonisation for WiFi spectrum is essential. We are therefore closely watching international developments on this particular issue. In response to the suggestion that we should license WiFi spectrum, we note that WiFi already operates under a general user licence. Private or individual licences for WiFi would be administratively cumbersome, would entail significant compliance costs, and would not align with the concept of WiFi spectrum as a common space. Users who require certainty around quality of service for critical uses should seek alternative arrangements for licensed spectrum. B4.4 Navigation and traffic systems Submitters agree that intelligent traffic systems require spectrum. They note that these systems are in use in Japan, and urge MBIE to proceed with planning in this area following international harmonisation and consultation with affected industries. The Ministry notes these points, and is keeping watch on international developments in this area. B4.5 Electromagnetic near field devices Telecom, the only submitter to directly respond to this point, agrees that MBIE should continue to monitor the sector. B5. Industry specific trends A range of submitters consider convergence to be the key trend affecting radio spectrum management. Technological convergence 1 in telecommunications and broadcasting is a trend that potentially results in considerable consumer benefits, but it also carries risks regarding industrial competition and established ways of doing business. 1 Convergence can be defined as a blurring of the boundaries between the traditional service definitions used in spectrum management, such as between broadcasting and cellular mobile services. 19
20 While the Ministry accepts that there may be disruptive effects of convergence on major spectrum users, we consider many of the issues to which convergence gives rise to be out of scope for the Radio Spectrum Five Year Outlook. We encourage submitters who commented on these points to engage with other relevant government agencies such as the Ministry of Culture and Heritage. However, we agree with broadcast submitters that terrestrial free-to-air television is not likely to experience critical decline in the next five years. We accept that demand for both cellular spectrum and WiFi spectrum is likely to rise as data-hungry applications such as mobile broadband (including for social networking) and internet television gain popularity. B5.1 Telecommunications industry trends Telecom argues that the continuing proliferation of wireless devices requires more spectrum to be set aside for these uses, and that this spectrum must be internationally harmonious. Vodafone submits that it is not clear that MBIE recognises the pivotal role of the growth of mobile broadband and mobile data in the consultation draft. 2Degrees adds that consolidation and convergence make competition safeguards all the more important, and argues that in a converging industrial environment, competition should be identified as a key emerging trend and driver of spectrum demand and use. 2Degrees notes the bearing that fixed telecommunications policy has on spectrum policy outcomes and vice versa. The Ministry has noted these points. In response to concerns raised by some submitters, MBIE wishes to assure stakeholders that there is active regular communication between the telecommunications policy and spectrum policy teams within the Ministry, under the oversight of the Minister for Communications and Information Technology. B5.2 Broadcasting industry trends B5.2.1 Radio broadcasting Most submitters agree with MBIE that New Zealand is unlikely to experience significant demand for digital radio during the Five Year Outlook period, and that demand for analogue radio is likely to remain steady. There is agreement that demand for digital radio in New Zealand is likely to be heavily influenced by overseas developments, such as the importation of cars with in-built digital radios. The RBA states that for cost reasons, the eventual implementation of digital radio should coincide with the end-of-life replacement of current analogue radio transmitters, meaning that a year planning period is required. SKY TV suggests that New Zealand's topography makes it well suited to digital satellite radio, but the high cost for broadcasters and consumers limits its viability. Nonetheless MBIE should consider the MHz and 2.3GHz bands for future digital radio use and not prevent technological development and implementation by 20
21 allocating these bands to other uses. Similarly, Optus considers that there is potential for digital radio and that MBIE should reserve the MHz band for digital radio. The Ministry accepts that there is little immediate demand for digital radio in New Zealand, and notes that there are competing suggestions of appropriate band use for digital radio. This is an area that we will continue to monitor closely. B Television broadcasting There is disagreement amongst submitters about the extent to which Internet Protocol Television (IPTV) and other internet-based video media is replacing traditional broadcast television. Some submitters who argue that the internet is rapidly overtaking traditional broadcast television, and some of those who argue that it is not, refer to the same Australian Communications and Media Authority (ACMA) report to substantiate their arguments. Many submitters who doubt the uptake and impact of IPTV stress the continuing digital divide, and the ongoing monthly cost of broadband access, compared to the one-off cost of a Freeview television or set-top box. Broadcasters tend to argue this point in terms of cost and convenience to consumers, while PSB groups stress the underlying public service principle of universal access. Furthermore, submitters point out the gap between Ultra-Fast Broadband (UFB) coverage and actual uptake by consumers. MediaWorks argues that television content rights holders cannot be expected to sacrifice existing revenue by making content available freely online. SKY TV does not consider that IPTV via UFB will replace direct-to-home satellite broadcasting within the Five Year Outlook period. Broadcasters all note that television on mobile devices is relatively untested, and therefore demand levels are uncertain and commercial viability is unclear. B6. Compliance and interference issues Submitters note that increasing spectrum use and subsequent congestion brings potential for increased interference issues, and urge MBIE to increase its monitoring of compliance and interference accordingly. Emissions from non-radio electronic devices are also seen as increasingly problematic Many submitters recommend a review and tighter enforcement of standards applied to the importation of potentially interfering devices, and endorse MBIE s intention to work more closely with Customs. One submitter notes that increasing interference issues can discourage amateur radio and radio astronomy in educational institutions, and thus lead to a future shortage in qualified radio engineers and technicians. This is identified as conflicting with the Ministry s stated aim of fostering engineering capability. 21
22 Submitters are generally happy with the approved radio engineers regime, but recommend some clarification of rules and regulations in the upcoming review of the Radiocommunications Act: In section 25A of the Act, change must have regard to to only if satisfied that requirements are met. Enshrine IRR articles 3, 15, and 18 in the Act. Clarify appropriate methods for resolving interference issues, including consideration of tight timeframes needed for commercial realities. Review power floor levels, as they are out of date for smartphones. This impacts on the definition of a harmful emission. Review GULs for Sort Range Devices (SRDs), because the industry was not adequately consulted in the 2012 review, and the cumulative effect of SRDs and mesh networks could be detrimental to mobile network users. Increase the effective isotropically radiated power (e.i.r.p.) limit from 1W to 4W in the MHz band. Manage resulting interference risks through a proactive approach to compliance monitoring and enforcement, education, and by industry self-regulation." Clarification of the rules around the cumulative interfering effects of individually licensed emissions: who is to blame when no one party is individually responsible for interference? Include interference from unlicensed operation in the scope of the Act to reflect the increasing availability of mass market devices that operate in unlicensed modes. There is currently no specified bandwidth for Adjacent Frequency Emission Limits (AFELs), making measurement impossible. It is suggested that measurement bandwidths in line with recommendation International Telecommunications Union Radiocommunications Spectrum Management (ITU-R SM) 329 be specified. Uber Group suggests isolating the MetService s rain radar from the GUL band used for WiFi to avoid interference. Kordia notes that the Act and Regulations are unclear about the difference between dbw e.i.r.p. (which measures power) and dbw e.i.r.p./reference bandwidth (which measures spectral density). 2 Kordia recommends clarification of what "level" means, as well as clear reference to bandwidth. 2 Kordia likens this difference to that between kilometres, measuring distance, and kilometres per hour, measuring speed. 22
23 As spectrum bands become more congested, the Ministry will continue work to mitigate the effects of harmful interference from individual and multiple devices. However, we note that any significant increase in interference monitoring would entail an increase in our operating costs, which would likely have to be passed on to licence holders. Particular issues that we consider deserve further attention from us include power floor levels and the measurement of e.i.r.p. limits. Analysis of submissions reveals some misconceptions regarding MBIE s responsibilities for addressing interference, especially in spectrum under the management rights regime. The holders of management rights have significant responsibility for monitoring and reporting interference in, and adjacent to, their spectrum bands. We are aware of past interference issues resulting from WiFi use in the spectrum used by the Metservice. The Radio Spectrum Management compliance team will continue to monitor this area and enforce relevant regulations. According to regulation, WiFi devices operating in spectrum close to the Metservice s rain radar must have dynamic frequency selection capability, which is designed to prevent interference. Devices that comply with the regulations therefore should not cause interference issues; those that do cause interference are non-compliant and their operators risk being subject to compliance enforcement measures including infringement notices, instant fines and, ultimately, prosecution. 23
24 Section C: Key spectrum projects C1. Legislative amendments In general, submitters welcome a full review of the Act because fifteen years have passed since it was last reviewed. However, many do not think significant changes are required. Many suggest that the review take place concurrently with a review of the Broadcasting, Commerce, and Telecommunications Acts to provide a betteraligned legislative context for the converging telecommunications and broadcasting industries. Some submitters suggest that management right payments be made over time (annually or in five yearly lots), particularly for mobile network providers; this could free up capital for the faster roll-out of infrastructure once spectrum has been allocated. MBIE has noted these points and will consider whether legislative amendments are required as part of the Act review. This process will include further consultation. We also encourage interested parties to participate in the Telecommunications Act review. We consider that there are strong arguments both for and against deferred payments. Part payments or deferred payments have been used in the past, and considerable administrative and legal costs were involved. Establishing a clear framework for deferred payments could trim these costs for possible future instances. This issue will therefore receive further consideration in the upcoming review of the Radiocommunications Act. C1.1 Compliance and interference issues Section B6 sets out specific recommendations from feedback for compliance issues in the legislative review, and the Ministry s response. Vodafone submits that management of interference should be the focus of the Act review, including at the licence-issuing stage, in terms of improving remedies for managing interference issues and broadening the scope of interference issues not currently covered. Conversely, Telecom submits that no legislative changes are required to deal with interference. Kordia also argues that legislative change is not needed, but that MBIE could adequately address harmful interference from co-channel emissions by changing its interpretation of the Act to be in line with IRR article 1. MBIE has noted these comments. They will be useful in our upcoming review of the Radiocommunications Act. 24
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