Sharing, selling and standardizing – the great spectrum conundrum

With the World Radiocommunication Conference currently underway in Egypt, it’s timely to discuss some of the spectrum issues facing the industry today.

Spectrum is and will probably remain a hot-topic for the industry due to its critical importance. The success of a telco is partly defined by the spectrum licences it is able to horde, and depending on where you are in the world, the scarcity of these assets varies. That said, to describe anywhere as having an abundance would be foolish to say the least.

Starting with the idea of selling spectrum, this is a topic which is under constant debate, review and criticism.

“When you talk about spectrum, the price you have to pay always has an impact on the rollout strategy,” said Jasper Mikkelsen, Director of Public and Regulatory Affairs for the Telenor Group, during a panel session this week.

This is where the balancing act is at its finest. The regulators will argue they need to charge for access to spectrum for several reasons, but the price of spectrum is often the centre of criticism in various markets. Mikkelsen pointed out during the auctions in Thailand earlier this year, many of the spectrum assets went unsold due to the reserve prices assigned to the lots.

However, according to Donald Stockdale of the FCC, the complaints from telcos might have some merit. If spectrum is unsold at the end of the auction, this is most likely due to the auction being badly designed. Perhaps not enough was released, the channels hadn’t been cleared effectively, the reserve price was too high, or the obligations attached to the winning assets were deemed unreasonable by the telcos.

Telcos will always complain and point to markets where spectrum is effectively given away for free, however there are cases where they have a point. If such a valuable asset is remaining unsold, despite the pleas of telcos to free-up more spectrum, there is perhaps something wrong with the product itself.

What is worth noting is that the auction process is not perfect. There will always be complaints and criticism, though it is currently the least worst option. It is certainly better than the ‘beauty contest’ concept, which leaves the door wide open to corruption.

How to design and manage spectrum auctions is more of a ‘trial and error’ process, which will come as little comfort to those shelling out the investments, however the idea of standardising is something which should certainly be given more traction.

This will of course be a topic of conversation for at the World Radiocommunication Conference, especially concerning the higher frequency airwaves, though there is still a lot of work to do on the spectrum licenses which are already a hotch-potch of complexity.

While there is work being done to standardise spectrum across various different regions, this is a lot more complicated than just simply creating new rules. Bureaucrats have to deal with the dreading concept of legacy.

As Michael Sharpe, Director of Spectrum and Equipment Regulation at ETSI, pointed out there are 48 countries in Europe, all of which have been assigning spectrum to different usecases, products and services over the last few decades. Harmonisation is a topic of conversation now but unravelling the maze of red-tape which already exists in each of these nations is a very complex task.

First and foremost, there are some very attractive benefits from standardisation. In a region like Europe, the risk of interference is present, driving the case, while there are also be benefits driven through interoperability or economy of scale, however there will always be a downside.

Looking at Europe once again, the congestion of certain bands will vary depending on the demands of the nation, while the cost assigned to clearing these costs will certain vary quite considerably. Then you have to look at the idea of flexibility.

Politicians generally don’t like being told what to do, and they like it even less when it comes from bureaucrats over which they have very little influence. In designing a harmonised approach to spectrum allocation and usage, flexibility will need to be built into the process to ensure each nation can address the specific needs of dominant industries and the nuances of societal variance.

This is of course very difficult to judge the right balance, but it is a critical element not only to ensure economic prosperity in each of the nations, but to make sure the rules are adopted by the Governments in question. If it is too much of a hinderance or costs too much to clear the bands, who is to say these suggestions are not just simply ignored, these are sovereign states after all.

The final area which is attracting some attention out of the US is a spectrum sharing initiative out of the FCC.

Focusing specifically on the valuable 3.5 GHz spectrum band which is being championed in Europe to deliver the first 5G services, the FCC is trialling a dynamic spectrum sharing project. Known unofficially as the ‘Innovation Band’, it offers a palatable compromise between high-speed data transmission and extended coverage. However, the US has found itself in a bit of a pickle as the current incumbent on this spectrum band is the Navy.

The spectrum is currently utilised by the Navy in offshore radar operations, however it is not being used all the time, such is the nature of naval operations. For such valuable spectrum, this is largely viewed as a waste.

Stockdale highlighted the team has created a three-tier, demand-orientated system, where spectrum is utilised dependent on the presence of those in the tier above. The Navy has the right to use the band first and foremost, though when it become unutilised, mobile service providers can purchase licenses to gain access for the second tier. Should the Navy or the telcos not be making use of the spectrum, it can be assigned for general use for those approved in the third-tier.

Although this is only a trial for the moment, it demonstrates the point made above. Flexibility needs to be built into spectrum harmonisation initiatives, as it is unrealistic to repurpose this band in the US. The cost and effort are unlikely to be justifiable when you consider the size of the US Navy.

This is an excellent example of innovation when looking at spectrum, and regulators around the world should be paying attention to the lessons learned through this experiment. The idea of dynamic spectrum sharing could be huge if the fundamentals are validated here, such is the demand for this valuable and increasingly scarce resource.

This is of course not the only example of spectrum being repurposed in regions where it is not being utilised. In the UK, Ofcom has introduced rules which dictate unused spectrum must be released, assuming there is demand.

Vodafone recently announced it entered into a three-year agreement with StrattoOpencell to share the use of it 2.6 GHz spectrum assets to deliver connectivity in Devon. The spectrum licences are being used in highly-urbanised areas, but not in the countryside, therefore it is inefficient use of the asset without these rules from the regulator.

Although spectrum is a topic which has been the centre of many debates, it does appear it will be an ever-lasting ebb and flow. The World Radiocommunication Conference will likely free-up some more spectrum, but the TMT industry is very good at finding ways to use it. Scarcity is most likely going to persist, though there are some interesting conversations evolving to improve this niche of the mobile segment.

Microsoft might be toying with European data protection compliance

The European Data Protection Supervisor has raised ‘serious concerns’ over whether Microsoft is compliant with data protection regulations.

The contracts in question are between the software giant and various European Union institutions which are making use of said products. The central issue is whether contractual terms are compliant with data protection laws intended to protect individual rights across the region from foreign bodies which do not hold data protection to the same standards.

“Though the investigation is still ongoing, preliminary results reveal serious concerns over the compliance of the relevant contractual terms with data protection rules and the role of Microsoft as a processor for EU institutions using its products and services,” a statement reads.

“Similar risk assessments were carried out by the Dutch Ministry of Justice and Security confirmed that public authorities in the Member States face similar issues.”

The preliminary findings from the European Data Protection Supervisor follow on from investigations taking place in the Netherlands and also changes to the Microsoft privacy policies for its VoIP product Skype and AI assistant Cortana. The changes were seemingly a knee-jerk reaction to reports contractors were listening to audio clips to improve translations and the accuracy of inferences.

What is worth noting is that Microsoft is not the only company which has been bending the definition of privacy with regard to contractors and audio clips. Amazon and Google have also been dragged into the hazy definition of privacy and consent.

The issue which seems to be at the heart of this investigation is one of arm’s length. While government authorities and agencies might hand-over responsibility of data protection and privacy compliance to the cloud companies, the European Data Protection Supervisor is suggesting more scrutiny and oversight should be applied by said government parties.

Once again, the definition and extent of privacy principles are causing problems. Europe takes a much more stringent stance on the depth of privacy, as well as the rights which are affording to individuals, than other regions around the world. Ensuring the rights of European citizens are extended elsewhere was one of the primary objectives of the GDPR, though it seems there are still teething problems.

“When using the products and services of IT service providers, EU institutions outsource the processing of large amounts of personal data,” the statement continues.

“Nevertheless, they remain accountable for any processing activities carried out on their behalf. They must assess the risks and have appropriate contractual and technical safeguards in place to mitigate those risks. The same applies to all controllers operating within the EEA.”

One development which could result in additional scrutiny is The Hague Forum, an initiative to create standardised contracts for European member states which meet the baseline data protection and privacy conditions set forward. The European Data Protection Supervisor has encouraged all European institutions to join the Forum.

Although GDPR was seen as a headache for many companies around the world, such statements from the European Data Protection Supervisor proves this is not an area which can simply be addressed once and then forgotten. GDPR was supposed to set a baseline, and there will be more regulation to build further protections. Perhaps the fact that Microsoft is seemingly non-compliant with current regulations justifies the introduction of more rules and red-tape.

Europe decides to punish Broadcom before its investigation is complete

The European Commission is in the process of investigating Broadcom for anticompetitive behaviour, but has imposed sanctions in advance of any conclusion.

Broadcom is considered to be dominant in the market for set-top box chips and some fixed line modems. The EC reckons it’s abusing that dominant position by persuading customers to go all-in on its products, thus unfairly restricting competition. The investigation was opened last June but the EC is so concerned about the effects of these practices that it has ordered Broadcom to stop them immediately.

“We have strong indications that Broadcom, the world’s leading supplier of chipsets used for TV set-top boxes and modems, is engaging in anticompetitive practices,” said EU Competition Commissioner Margrethe Vestager. “Broadcom’s behaviour is likely, in the absence of intervention, to create serious and irreversible harm to competition. We cannot let this happen, or else European customers and consumers would face higher prices and less choice and innovation. We therefore ordered Broadcom to immediately stop its conduct.”

The key word in that quote is ‘likely’. Vestager seems to be saying that mere suspicion is now reason enough for the EC to act against companies pre-emptively, in anticipation of the outcome of its investigation. What if the investigation concludes in favour of Broadcom? This seems to be a dangerous erosion of due process and an ominous precedent for any company that does business in Europe.

Broadcom now has 30 days to do the following or else:

  • Unilaterally cease to apply the anticompetitive provisions identified by the Commission and to inform its customers that it will no longer apply such provisions; and
  • Refrain from agreeing the same provisions or provisions having an equivalent object or effect in other agreements with these customers, and refrain from implementing punishing or retaliatory practices having an equivalent object or effect.

Those restrictions apply until the EC get around to concluding its investigation or three years, whichever is sooner. It’s common practice for big companies to chuck lawyers at these kinds of investigations in order to drag them out, so you can see where the EC is coming from with this kind of pre-emptive action. But due process exists for a reason and the EC seems to be saying it’s better that a few innocent companies may be hurt than any guilty ones go unpunished.

Europe’s security vision undermined by lack of compulsory requirements

For the most part, companies have to be forced to take security seriously, but perhaps these changes are on the horizon in Europe at least.

Cybersecurity is always a topic of conversation which is never too far away, though you have to question the substance behind the statements. Security and privacy are always top priorities for a company if you listen to the CEO, though the fact that security breaches still persist undermines these bold claims.

To be fair to the companies involved, this is a fast-paced and ever evolving aspect of the technology landscape. Is there such thing as 100% secure? No. Can the companies do more to protect their customers? Yes.

This is where the European Commission plays a critical role in developments. Speaking at Broadband World Forum in Amsterdam, Julie Ruff. Directorate for Digital Society, Trust & Cybersecurity, outlined the challenges, as well as the ways and means to combat these threats, and the telcos will be central to these efforts.

“First of all, they are obvious targets for cyber-attacks [the networks], very attractive targets,” said Ruff.

“The networks can be used as vectors for attack.”

The network is the lynchpin for tomorrow’s economy, the backbone of the virtual world. It’s the digital superhighway which connects anything, everything and everyone. The networks owners need to lead from the front, but they are not the only character in this nefarious saga.

As part of the latest iteration of the Cyber Act, the European Commission has introduced a certification framework for ICT digital products, services and processes. This framework will provide a comprehensive set of rules, technical requirements, standards and procedures to ensure consumers and businesses are protected from the dangers lurking in the dark corners of the world wide web.

This is all well and good, but here is the major problem; the certification process is currently voluntary.

At the largest companies, resources can be redirected towards such initiatives to ensure the demands and nuances of the framework are being adequately met. However, this is not going to be the biggest problem the digital economy will face. The start-ups and SMEs, those who can easily find other means to spend valuable and limited funds, will not voluntarily direct investment towards cost-centres and away from profit-builders.

However, with more risks being realised further afield in the ecosystem, a comprehensive approach to security is needed everywhere and anywhere. As Ruff pointed out during her presentation, the interconnected nature of the digital economy means that cybercriminals can infiltrate networks through weak points in the chain.

This is where the European Commission needs to move forward to ensure the certification framework is compulsory not voluntary. It might come as a financial burden to the start-ups, but it is the only way to most effectively mitigate risk. The investments being made by multi-nationals and telcos could be completely undermined by a rogue device connected to the network.

For the digital economy to be anywhere near ‘safe’, connected devices, whatever they may be, need to be secure out of the box and providers need to ensure timely and regular security updates. Unfortunately, this perfect scenario can only be achieved through effective regulation and a compulsory certification framework.

A good vision has been outlined by the European Commission, but this needs to be backed-up by effective and compulsory regulation.

Italy readies itself for tax assault on Silicon Valley

The Italian Government is preparing to join the UK and France in taking a tougher tax stance against Big Tech with the introduction of a 3% sales tax.

Designed to target the elusive technology giants which have been slipping between the mountains of red-tape to take advantage of cheaper tax destinations, the levy will be based against revenues realised in the market as opposed to tax. While it might be possible to move profits to different markets in the bloc, it is much more difficult to disguise payments taken from individuals who physically reside in Italy.

While it still might be early days in tackling the abuses of the taxation landscape, momentum is starting to gather. According to sources, the new tax regime could be announced during the next budget and set in place January 2020. The new budget from the coalition is due to be submitted to the European Commission today [October 15].

Although details are relatively thin for the moment, take any predictions or leaks with a pinch of salt. It would be fair to assume Italy is heading down the same route as the UK and France in holding Silicon Valley accountable to a fair and reasonable tax position, though due to the complicated political situation in the country, what form this could take is unknown for the moment.

During the 2018 Italian election, no political group or party won an outright majority resulting in a hung parliament. Numerous coalition governments could have been formed, and after a few failed attempts, the centre-left Democratic party and the anti-establishment Five Star Movement were sworn in last month.

These policies have been in the works for some time now, though what eventually comes out of the wash remains to be seen. Interesting enough, the failure of this latest coalition could force the country into another election, potentially a new government and perhaps a new line on tackling Big Tech.

That said, the only thing which is clear coming out of this political kafuffle is that Silicon Valley is a target.

Across Europe there are several member states who are becoming increasingly frustrated with the flamboyance of the internet giants accounting departments. There are of course a few who have scuppered a pan-European approach to new digital tax rules, the likes of Ireland and Luxembourg of course benefit from the unfair status quo, though with several member states going it alone, the writing is on the wall for Big Tech.

This is just one element of the changing landscape for tech. Alongside a rethink on tax rules, regulation and legislation governing data, privacy, surveillance, free speech, political advertising and artificial intelligence are in the works. Governments and regulators are attempting to drag bureaucracy and the rulebook into the digital era, and it might be a bit uncomfortable for some of Silicon Valley’s residents.

Europe postures with standards leadership still on the line

European standards organization ETSI has released a report demanding the continent take a leadership role for standards and regulation in the global digital economy.

While some might question whether the sluggish Brussels bureaucrats can get up to speed quick enough, there is hope; regulators around the world all share the same track-record when it comes to the painfully slow progress of creating regulatory and legal frameworks.

The report, commissioned at the request of ETSI, was authored over the first-half of 2019 and demands Europe take the lead on creating the standards necessary for a healthy and progressive digital economy.

“Our competitors are very serious about taking the lead in digital transformation,” said Carl Bildt, Co-Chair European Council on Foreign Relations.

“It is important that EU lawmakers put standardization at the centre of EU digital and industrial strategy. Otherwise Europe will become a rule taker, forever playing catch-up in the innovation, production and delivery of new digital products and services.”

Although many would want to see a collaborative, geographically-neutral, approach to standardising the digital economy, this is unlikely to happen. As Bildt highlights above, someone will take a leadership position, standards will gain acceptance, before other regions will have to adopt the rules.

The question which remains is whether Europe, the US or China will have the greatest influence on global standards. In fact, ETSI questions whether Europe is keeping pace with leaders today or whether its influence is waning already. Unfortunately, with the platform economy gaining more traction each day, this is one area which should not be considered a strength of the bloc.

46% of platforms with a revenue above $1 billion are based in the US and 35% in Asia, while Europe only accounts for 18%. These platforms often drive their own ecosystems and have largely been self-regulating to date. This is going to change in the future, though to give European organizations a chance at capturing growth, the European Commission might have to lead the charge to create open-standards. The contrary approach might only offer the established players greater momentum and influence.

This is perhaps the risk which is emerging currently. The idea of globalisation and open-standards are not new, though there is evidence certain markets are heading towards a more isolationist mindset and regime.

Although it is easy to point the finger at aggressive political leaders elsewhere, the report demands Europe look intrinsically also. The European Commission has to take a strong leadership position across the bloc, as with 28 members states there is risk of fragmentation. It only has to be slight variances to start, but this could snowball into greater complications. The digital tax conundrum is an example of what can go wrong over an extended period of time.

This report might be more of a generalist statement to encourage a proactive mindset from European bureaucrats, though there are plenty of examples of governments, public sector administrations and private industry trying to control the tone.

Looking at the ever more influential world of artificial intelligence, the number of feasibility, standards and ethics boards is quite staggering. All of these initiatives will want to create rules and frameworks to govern the operation and progression of AI, though only one can be adopted as the global standard. Regional variances are of course feasible, but this should not be deemed healthy.

In the UK, the Government created its AI Council. The European Commission has released various white papers exploring how AI should be governed. The White House’s National Science and Technology Council Committee on Technology is also exploring the world of AI. Facebook has even created its own independent advisory panel to aid the creation of standards and regulation.

Should Europe want to control the global standards process, it will come up against some stiff competition. The power and influence of the US should not be underestimated, it is home to some of the worlds’ most recognisable and profitable brands after all, while China has a track-record of flooding working groups at standards organizations. This will have a noticeable impact on the final outcome.

That said, the success of GDPR will offer hope.

Europe’s General Data Protection Regulation might have caused headaches all around the world, but it has set the tone on the approach to privacy, management of data and the influence of the consumer. Since its introduction, several other countries, India and Japan being two examples, have been inspired by GDPR to introduce similar regulation, while there have been calls in the US to do the same also.

This piece of regulation was critical to ensure the European principles of privacy are maintained moving forward. This is a win, but there are still battles to be had when it comes to AI, security, encryption, cross-border data flow and access to data.

Standardisation might not be the most exciting topic to discuss in the TMT world, though taking a leadership position can offer advantages to the companies who call that region home. A thorough and innovative regulatory regime can open-up new markets, ensure competition is healthy throughout the ecosystem and drive national economies at scale.

The regulatory landscape is set to undergo somewhat of a shift over the coming months and years, though which region will take the lead is still hanging in the balance.

Europe publishes 5G security report to state the obvious

After months of deliberation and consideration, the European Commission has published a report which comes to some fairly obvious conclusions on 5G security.

Although few would have expected something substantial from the bureaucrats, the published report seems to offer little to no insight or additional information. Once again, the Brussels brigade is showing how painfully slow progress can actually be.

“Today, Member States, with the support of the Commission and the European Agency for Cybersecurity published a report on the EU coordinated risk assessment on cybersecurity in Fifth Generation (5G) networks,” a statement reads.

“This major step is part of the implementation of the European Commission Recommendation adopted in March 2019 to ensure a high level of cybersecurity of 5G networks across the EU.”

In short, the report comes to a few conclusions:

  • Poor software development process could be a danger
  • Certain pieces of network equipment or functions are becoming more sensitive, base stations for example
  • State-backed threats are the highest concern
  • Telcos are too dependent on a small number of suppliers, some of whom could be considered a security right
  • Threats to communications infrastructure should be considered a security risk

Amazingly, the European Commission has managed to create a 33-page report, which says nothing significant or particularly useful. Everything which has been stated is already known by those paying attention, though we suspect there would be a few politicians who would benefit from reading the report.

So, what does the report actually mean? Nothing for the moment. If anyone was expecting any action will be wildly disappointed, though the European Commission is suggesting member states create action plans to compensate for the increased risk. As you can imagine, there is little rush to complete these action plans, as the European Commission has given a deadline of October 1, 2020.

Every now and then the European Commission reminds us how painful bloc-wide bureaucracy can be, and this report has proven to be an excellent example. At some point in the future, the bureaucrats might create official security guidelines and regulation for member states to follow, though this is unlikely to be done in a timely manner.

Europe steps up its censorship efforts

The European Commission wants to pay people to help ensure only the kind of information it approves of is allowed to be published online.

The initiative is being called the European Digital Media Observatory and it is the continuation of a digital censorship project the EC has been working on for some time. The stated aim is to counter ‘disinformation’, which is defined as “verifiably false or misleading information that is created, presented and disseminated for economic gain or to intentionally deceive the public.”

On the surface what’s not to like about this? Everyone knows the internet is awash with misleading and biased information that presumably, at least in part, is published with the aim of persuading the public of a certain point of view. If people are given the wrong information then they might make the wrong electoral decisions and that would be bad.

The main problem with censorship is subjectivity. Who decides what is false or misleading and who can possibly be sure of the motives for someone else’s actions? The answer to that question in this case seems to be anyone who fancies €2.5 million of European public money, because today the EC published a call for tenders to create the first core service of this new censor.

“The European Digital Media Observatory will allow fact-checkers and academic researchers to bring together their efforts and actively collaborate with media organisations and media literacy experts,” said the announcement. Don’t worry folks, the experts have got this, you’ll only get the purest, most correct information from now on.

The inclusion of the private sector in this project may be designed to create the impression of neutrality as well as expertise, but whoever wins the tender will be acutely aware of who pays their salary. Can we be sure that suspected disinformation which is helpful to the EU will be treated with the same severity as that which is harmful to it? The best counter to disinformation is public scrutiny, not censorship.

Europe wants Facebook to implement its censorship requests globally

A new ruling by the EU Court of Justice seems to compel social media companies to enact EU censorship demands even outside of its jurisdiction.

The judgment was made on the case of Eva Glawischnig-Piesczek v Facebook Ireland, in which the Austrian Green Party politician seeks to force Facebook to remove content that she feels is harmful to her reputation and anything that sounds a bit like it. The court was asked to interpret the Directive on electronic commerce and concluded it doesn’t prevent member states from imposing the following on ‘host providers’, which seems to mean all social media platforms and maybe beyond.

  • To remove information which it stores, the content of which is identical to the content of information which was previously declared to be unlawful, or to block access to that information, irrespective of who requested the storage of that information;
  • To remove information which it stores, the content of which is equivalent to the content of information which was previously declared to be unlawful, or to block access to that information, provided that the monitoring of and search for the information concerned by such an injunction are limited to information conveying a message the content of which remains essentially unchanged compared with the content which gave rise to the finding of illegality and containing the elements specified in the injunction, and provided that the differences in the wording of that equivalent content, compared with the wording characterising the information which was previously declared to be illegal, are not such as to require the host provider to carry out an independent assessment of that content (thus, the host provider may have recourse to automated search tools and technologies);
  • To remove information covered by the injunction or to block access to that information worldwide within the framework of the relevant international law, and it is up to Member States to take that law into account.

In other words, if an EU member state decides a bit of online content should be censored, there’s nothing stopping it legally compelling internet platforms to remove it and anything its algorithms consider to be similar to it on a global basis. This seems to put enormous power of censorship in the hands of EU claimants who can afford to litigate.

“This judgment has major implications for online freedom of expression around the world,” said Thomas Hughes, Executive Director of free speech campaign group Article 19. “Compelling social media platforms like Facebook to automatically remove posts regardless of their context will infringe our right to free speech and restrict the information we see online. The judgment does not take into account the limitations of technology when it comes to automated filters.

“The ruling also mean that a court in one EU member state will be able to order the removal of social media posts in other countries, even if they are not considered unlawful there. This would set a dangerous precedent where the courts of one country can control what Internet users in another country can see. This could be open to abuse, particularly by regimes with weak human rights records.”

As calls for censorship mount, the global policing of speech on the internet is becoming impossibly convoluted. Will the EU now seek to punish Facebook, or whoever, if a bit of content it doesn’t like is accessible somewhere outside of its jurisdiction, and if so how? What if courts in the other country take a different view? As ever the only solution is to not censor in the first place.