Opinion of the Economic and Social Committee on the "Green Paper on Radio Spectrum Policy in the context of European Community policies such as telecommunications, broadcasting, transport, and R& D"

(1999/C 169/02)

On 15 December 1998 the Commission decided to consult the Economic and Social Committee, under Article 198 of the Treaty establishing the European Communities, on the above-mentioned proposal.

The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for preparing the Committee's work on the subject, drew up its opinion on 13 April 1999. The rapporteur was Ms Thompson.

At its 363rd plenary session (meeting of 28 April 1999) the Economic and Social Committee adopted the following opinion by 66 votes to 1 with 1 abstention.

1. Introduction

1.1. The Green Paper on Convergence between telecommunication, media and information technologies(1) and other Community documents have in recent years highlighted the use of radio spectrum and the complex decision making that exists in this important economic and social area. There is massive expansion, major economic activity, and therefore a need for a review.

1.2. Countries historically co-ordinate the use of the radio spectrum in the framework of the International Telecommunication Union (ITU), a specialized body of the United Nations. In World Radiocommunications Conferences (WRC) of ITU, 186 countries biannually adopt measures in order to achieve international harmonization. In Europe, 43 countries, including the Member States, co-ordinate the use of the radio spectrum in the framework of the European Conference of Postal and Telecommunications administrations (CEPT) and its sub-committee, the European Radiocommunications Committee (ERC).

1.3. During the next two years there will be some important policy discussions: the "99 Review" for the Telecommunications Sector, important work in the transport sector, and the forthcoming World Radiocommunications Conference WRC - 2000.

1.4. The use of spectrum has become a major issue in Member States, the EU, the wider Europe, and globally. Technical improvements, and business and consumer demand over the last few years have made spectrum a very scarce resource. Inevitably different patterns of regulations and uses have developed nationally and internationally. In Europe CEPT has been able to ensure proper use and a reduction of technical problems. Any objective view of the current position would show that decisions about spectrum have a political, social, economic and technical component.

1.5. The European Union has a substantial interest in the development of a consistent radio spectrum policy as it is the backbone for a wide range of industrial activities in sectors such as telecommunications, broadcasting, transport, R& D and services of general interest.

1.6. The Green Paper seeks to identify how best to approach and implement spectrum policy at EU level.

1.7. In the changing environment Europe faces new challenges:

- The number of new systems both commercial and non-commercial is increasing.

- Globalisation increases the need for international co-operation.

2. The Commission's Green Paper

2.1. The EU and radio spectrum

2.1.1. The location and amount of radio spectrum allocated for each service may differ between countries and only a small amount of the radio spectrum is harmonized among countries.

2.1.2. EU action on radio spectrum differs significantly across sectors as the following examples show:

2.1.2.1. In telecommunications the number of applicants has increased due to technical innovation and the global liberalisation of telecommunications markets.

2.1.2.2. In contrast, radio spectrum availability for broadcasting has so far, except for a Council Resolution on public service broadcasting(2), not been addressed in the EU as an issue requiring political or legislative action.

2.1.2.3. Transport policies, in turn, benefit from radio spectrum being available on an almost exclusive and international basis.

2.1.2.4. Although earth observation and radio astronomy receive considerable EU funding, the radio spectrum available for these activities is under pressure.

2.2. EU policy on radio spectrum. Issues for comments

2.2.1. The European Commission invites comment on five key issues:

- strategic planning of the use of radio spectrum,

- harmonisation of radio spectrum allocation,

- radio spectrum assignment and licensing,

- radio equipment and standards,

- the institutional framework for radio spectrum co-ordination.

2.3. An overview of EU policies involving radio spectrum is given in Annex I of the Green Paper.

3. General Comments

3.1. The Committee welcomes the Commission's Green Paper and agrees that there is a need for a full debate on spectrum use.

3.2. In the light of the importance of the five areas mentioned in point 2.2.1 for a range of EU policies it is important that the EU plays an enhanced role in spectrum policy. This needs to build on the good work already undertaken particularly by CEPT and its sub-committees.

3.3. How spectrum decisions are currently taken through ITU, WRC and CEPT/ERC needs to be examined and there is a strong case for the EU to have more direct involvement in the development of radio spectrum strategies. The current process is clearly outlined in the Green Paper.

3.4. There needs to be a balance between the current technical assessment procedure and possible future more political, economic and social procedures for this scarce resource.

3.5. In spectrum policy today, the value of radio spectrum is not a predominant factor commonly taken into account, even though the relevant authorities increasingly use auctions and sales of defined and regulated licences for the use of spectrum. However, the Committee warns against this having a negative impact on employment or leading to increased costs for consumers.

3.6. Some of the key issues listed in the Green Paper conflict with each other; for example it is not always possible to reflect the economic value of radio spectrum and at the same time provide adequate spectrum for public interest, though it is apparent that the convergence of services using radio spectrum increasingly will become a reality.

3.7. Decisions in this area are of vast importance. Sometimes these are of a financial nature involving millions of Euros and sometimes of social importance such as old people's alarms or the use of radio frequencies for small scale community radio.

3.8. It is very apparent that EU objectives will not always be met within the current regulatory framework.

3.9. Areas that are particularly affected are:

- new developments and competition,

- establishing a clear legal framework,

- helping to balance Member States and European needs,

- strengthening the EU's role in global forum,

- technical standards and harmonization.

3.10. It is apparent that if the EU divides spectrum into five main areas strongly influenced by research(3):

- telecommunications,

- broadcasting,

- transport,

- Government (defence, and law and order), and

- R& D,

the EU's ability to influence each area will be different.

3.11. The Committee feels that there should be a mechanism to allow the EU a fuller role in spectrum policy. This is such a vast and complex area that it would be inappropriate for the EU to undertake a detailed management role, often undertaken competently by the CEPT/ERC and Member States Governments themselves. There is a role that needs to be played bringing in the important dimensions of economic, political and social considerations. This role will also enhance the single market, competitiveness, Europe's position in the global market and strengthen the EU's position in relevant international fora.

3.12. The Committee would support mechanisms that include this process, but would want to ensure that any new role the EU takes on in this field fully takes into account Member States activities and the mechanisms that currently exist.

3.13. The Committee will want any mechanism to be clear, open and transparent to ensure non-discrimination. Also current mechanisms must be made more open and transparent, so those that are applying to use spectrum have a clear understanding. This will also help to highlight how economic and social considerations are taken into account.

3.14. The Committee feels that it is important that good practice in spectrum management is shared across Member States and the EU should facilitate this. For example, in the allocation of radio licenses it is important to develop the social as well as the economic context. Socially there needs to be a commitment to diversity, which includes culture, type of program format and ownership.(4)

4. Specific Comments

4.1. The Green Paper underestimates national Government's potential concern about changes in spectrum allocation because increasingly spectrum allocation has been used to raise Government finance.

4.2. It is worthwhile considering that where the relevant authorities sell or auction licenses for the use of spectrum a significant percentage of these funds be earmarked for specific related activities such as R& D, rather than the funds going exclusively to national exchequers.

4.3. "Re-farming" proposals should, in the main, be market led. Any other proposals need to clearly convince current users of the economic benefits of spectrum change if it directly involves them in additional costs.

4.4. Where spectrum harmonisation occurs economic benefits would accrue. Standardisation would enhance the EU's position, but it must be noted that the direct economic benefits would be marginal. Radio spectrum harmonisation and equipment standards can result in significant benefits for the end user and sometimes in economic terms. Standards development should to a large extent be market led.

4.5. The Green Paper does not fully quantify the potential benefits from the use of digital technology. Which frequency bands will be freed and how will they be used in the future?

4.5.1. Any improved framework needs to be able to accommodate the very fast rate of technological development. Though it is very difficult with any degree of certainty to predict future developments in this area, it is an appropriate role for the EU to undertake.

4.6. The Committee wants to ensure the highest level of protection and public health. The Committee is aware of the work undertaken concerning the health considerations of the electromagnetic fields(5) and looks forward to strong and clear policies and continuous monitoring and research in this area.

4.7. Any changes to the current decision making process must adhere to the EU's policy of subsidiarity.

5. Conclusions

5.1. Radio spectrum is the backbone for a very wide range of different important industrial sectors. Currently decisions are made mainly on technical grounds and it is the Committees opinion that future decisions need to reflect the economic, social and political importance of spectrum usage.

5.2. The Committee feels that a fund should be set up for specific activities such as R& D and that this fund is financed by taking a percentage of the money that authorities gain, when they sell or auction licenses for the use of spectrum.

5.3. Any changes to the current decision making processes need to take into account CEPT's and ERC's role and avoid the EU becoming involved in massive detail of spectrum management. The EU in the telecommunications sector does play a role in harmonizing the availability of radio spectrum.

5.4. The Committee is of the opinion that the EU needs to play an enhanced and better co-ordinated role in spectrum policy by developing a transparent framework that emphasizes the economic, social and political aspect. The technological side also needs to be integrated into this planning framework, so that it takes into account the latest development in technology and in some instances it will need to predict future technological developments.

Brussels, 28 April 1999.

The President

of the Economic and Social Committee

Beatrice RANGONI MACHIAVELLI

(1) COM(1997) 623 final; ESC opinion in OJ C 214, 10.6.1998, p. 79.

(2) Resolution of the Council and the Representatives of the Governments of the Member States, meeting within the Council of 25 January 1999 concerning public service broadcasting; OJ C 30, 5.2.1999, p. 1.

(3) See the Fifth Framework Programme of the European Community for research, technological development and demonstration activities (1998 to 2002), OJ L 26, 1.2.1999, p. 1. ESC opinion on the "Fifth Framework Programme for RTD (1998 to 2002) - specific programmes" - OJ C 407, 28.12.1998, p. 123. ESC opinion on the "Fifth Framework Programme for RTD (1998 to 2002) - scientific and technological objectives", OJ C 355, 21.11.1997, p. 38.

(4) The ESC is preparing an own-initiative opinion on "Pluralism and concentration in the media".

(5) COM(1998) 268 final "Proposal for a Council Recommendation on the limitation of exposure of the general public to electromagnetic fields 0 Hz-300 GHz".